Update on Dual Track Sale Process

6 November 2018

Property Exchange Australia (PEXA or the Company) today announces that an offer to acquire PEXA first made on 8 October by Link Group (ASX: LNK), Morgan Stanley Infrastructure Inc and Commonwealth Bank of Australia (ASX: CBA) (Consortium) (Trade Sale Offer) and subsequently increased on 5 November has now been accepted by shareholdings representing greater than 50% of PEXA’s issued capital (Trade Sale Trigger).

Under the Trade Sale Offer:

• The price agreed with the Consortium represents an implied enterprise value for PEXA of at least $1.5bn, which can potentially increase to $1.6bn depending on the level of final acceptances for the Trade Sale Offer received by PEXA’s shareholders (Final Acceptances)
• Coupled with existing shareholdings of Link and CBA, the Acceptances as at 8pm AEST on Monday November 5 represented a majority interest in PEXA of 55.4% which has enabled the transaction to proceed
• Completion remains subject to a range of conditions precedent which are expected to take approximately several weeks to complete with the transaction expected to close before the end of the calendar year

Founded in 2010 to fulfil the Council of Australian Governments’ (COAG) initiative to deliver a single national electronic system for the settlement and lodgment of property transactions, PEXA has successfully built a network of over 150 financial institutions and more than 6,500 practitioner firms.

Alan Cameron, PEXA’s Chairman said: 

“On behalf of the Board, I wish to thank our existing shareholders for their support of PEXA’s vision, as well as the management team for executing on that vision and for successfully leading the company to this significant milestone in PEXA’s history.”

“The Consortium, including Link and CBA as long-time shareholders of PEXA, together with the addition of one of the world’s leading infrastructure funds, Morgan Stanley Infrastructure Funds, have a combined track record of investing in, and strengthening, infrastructure and technology assets, and we are very confident they are well-positioned to support PEXA’s future growth and contribute to further industry transformation.”

Marcus Price, PEXA’s CEO said:

“I am immensely proud of what the PEXA team has achieved in building and operating Australia’s first operational online property lodgement and settlement network, following eight years’ of development with government and private stakeholders. We have successfully delivered on our COAG mission, and in the process delivered a great return for the state governments, as well as developing infrastructure that will benefit generations of home buyers.”

“PEXA has always been about making the process of buying and selling more efficient and transparent, and the industry response has been overwhelming, with PEXA now accounting for more than half of all property settlements nationwide.”

“The sale of the business comes at a natural time in the company’s evolution, to both crystallise a return for shareholders and to transition to a new aligned ownership base, capable of leveraging the company’s advantageous position to drive our multi-horizon growth strategies.”

CLSA led by Mark Dorney acted as Financial Adviser on the transaction. Allen & Overy led by Michael Reede and Tony Sparks acted as Legal Advisers to PEXA.