The majority of PEXA’s shareholders have backed a joint bid by the Commonwealth Bank of Australia, Link Group and Morgan Stanley Infrastructure Partners Inc. to acquire the electronic property exchange service.
The consortium on 8 October 2018 made an offer for PEXA, whose major shareholders include the Victorian, New South Wales, Queensland and Western Australia governments, Australia’s big four banks, Macquarie Capital, Little Group and Link.
“The consortium will pay an enterprise value of up to approximately $1.6B, depending on the level of final acceptances to the trade sale offer received by PEXA’s shareholders,” an ASX statement issued by Link said.
Link’s shareholding will increase from its current level of 19.8 per cent to between 27 per cent and 44 per cent.
CBA said it would invest an additional $50 million in PEXA, for a total investment of around $100 million, increasing its stake from 13.1 per cent to approximately 16 per cent.
“Having been a key stakeholder in PEXA since its inception in 2011, today’s announcement represents our continued commitment to support the property industry as it transitions towards an innovative, fully digital, settlements process that aims to provide improved experiences for customers,” CBA chief executive Matt Comyn said in a statement.
Link said the deal remains subject to a range of conditions precedent, which are expected to take approximately two to three months to meet.
PEXA was formed in 2010 out of a COAG agenda item focused on the digital transformation of property conveyancing.
In June, the company was in the spotlight after a high-profile fraud case involving the theft of funds from the settlement of a property. The fraudster gained accessed to a conveyancer’s email account and used it to conduct a password reset of a PEXA account. PEXA has since rolled out a range of additional security measures, including multifactor authentication and anomaly detection.