Two real estate giants in the United States join forces! Rocket (RKT.US) splashes out 1.75 billion dollars to swallow Redfin (RDFN.US).

Rocket Companies (RKT.US) - the parent company of the well-known real estate lending institution Rocket Mortgage, announced on Monday that it has agreed to acquire the real estate brokerage firm Redfin (RDFN.US) for approximately $1.75 billion in an all-stock transaction. This significant deal in the U.S. real estate industry means that one of the most visited brokerage websites in the country is officially merging with one of the largest mortgage lenders. For comparison, Redfin had a market value of approximately $736 million as of the close of trading last Friday. Following the acquisition announcement, Redfin's stock price surged over 70% in pre-market trading. The online loan platform will acquire Redfin for $12.50 per share, representing a premium of about 63% over the 30-day weighted average price as of last Friday. According to the disclosed agreement terms, each share of Redfin common stock will be exchanged for 0.7926 shares of Rocket Companies Class A common stock. Redfin's stock price soared nearly 90% to $10.95 in pre-market trading, while Rocket Companies' stock price fell over 15%. Redfin's housing search platform has over 1 million listings for sale and rent and a tech-driven brokerage network consisting of over 2,200 agents. This acquisition will significantly expand Rocket's flagship mortgage business's potential borrower channels. "By joining forces, we will use leading technology to connect traditionally very fragmented search and financing processes, eliminate friction, reduce costs, and create greater value for American home buyers," said Rocket CEO Varun Krishna. The transaction is expected to strengthen Rocket's adjusted earnings per share by the end of 2026 and generate over $200 million in annual synergies by 2027. As part of the deal, Rocket will simplify its capital structure by eliminating the existing Up-C structure. After the significant restructuring, public shareholders will continue to hold their existing common stock, while Dan Gilbert and other Rock Holdings Inc. shareholders will directly hold Rocket Companies' common stock, no longer held through RHI. In conjunction with the Up-C structure adjustment, Rocket's board announced a cash dividend of $0.80 per share to be paid to registered shareholders as of the close on March 20, 2025, on April 3, 2025. This significant acquisition transaction is expected to be completed in the second or third quarter of 2025. Public data shows that Rocket Companies is a U.S.-based financial services holding company, with its most well-known subsidiary being Rocket Mortgage, a leading online mortgage platform. Overall, Rocket Companies' main business focus is in the mortgage and related financial services sector, including mortgage loans, refinancing, and some real estate technology services aimed at simplifying the process for consumers to obtain mortgages digitally. Redfin, on the other hand, is a technology-driven real estate brokerage firm specializing in providing consumers with property search, transaction services, and other online real estate-related services.