Private equity powerhouse KKR has teamed up with real estate technology and services firm Domain Holdings Australia Limited to make a A$3 billion ($2.3 billion) bid to acquire electronic property settlement provider Property Exchange Australia (PEXA).
PEXA is 44.2% owned by Australia’s listed Link Group, a provider of data and administration services to the finance industry. Other PEXA shareholders include Morgan Stanley Infrastructure Partners and Commonwealth Bank of Australia.
Link Group had earlier planned separation of its interest in PEXA, as well as a demerger into a separate ASX-listed entity. In February, Link Group said it will prioritise a trade sale process, in addition to the exploration of the viability of an IPO.
PEXA reported a 90% y-o-y increase in operating EBITDA to A$51.5 million in the first half of its financial year. Transaction volumes rose by 28% to 1.53 million.
As of 31 March 2021, the business estimated substantial transfer market share in Victoria (98%), New South Wales (96%), South Australia (95%), Western Australia (80%) and Queensland (60%). A total potential addressable market opportunity for the PEXA Exchange in Australia will be approximately A$280 million for the calendar year 2021, it added.
Earlier in October last year, a consortium led by Pacific Equity Partners and Carlyle Group proposed to acquire 100% of the shares in Link Group, but the consortium announced its withdrawal last month. The proposal had pegged an enterprise value for PEXA of approximately A$1.95 billion.
In January this year, American hedge fund and private equity administrator SS&C Technology Holdings also withdrew its takeover proposal of Link Group at A$5.65 per share.
Link Group’s stock price fetched A$5.45 on Friday.