Redfin shares jump on $1.75B acquisition by Rocket Companies
Published: 12:42 10 Mar 2025 EDT
Redfin Corp (NASDAQ:RDFN) shares surged more than 70% after the fintech company annoucned it is being acquired by Rocket Companies Inc (NYSE:RKT) in a transaction valued at $1.75 billion.
In the all-stock transaction, Redfin will be acquired for $12.50 per share.
Each Redfin share will be exchanged for 0.7926 Rocket Class A common stock shares, representing a 63% premium over Redfin's recent 30-day average price.
Rocket said that the acquisition will enhance its mortgage growth strategy by integrating Redfin's extensive real estate platform with Rocket's mortgage services.
The acquisition is expected to drive significant revenue synergies across real estate search, brokerage, mortgage origination, and servicing.
Rocket anticipates $200 million in synergies by 2027, including $140 million in cost savings and $60 million in revenue growth opportunities.
The deal is projected to be accretive to Rocket's adjusted earnings by the end of 2026.
"Rocket and Redfin have a unified vision of a better way to buy and sell homes," Rocket CEO Varun Krishna said in a statement.
"Together, we will improve the experience by connecting traditionally disparate steps of the search and financing process with leading technology that removes friction, reduces costs and increases value to American homebuyers."
The acquisition is expected to close in the second or third quarter of 2025.
Upon closing, Rocket shareholders will own approximately 95% of the combined entity, with Redfin shareholders holding about 5%.
Glenn Kelman will remain CEO of Redfin and report to Rocket's CEO Krishna.
Shares of Redfin were up 70.1% at $9.90 in the early afternoon on Monday while Rocket's share fell 14.2% to about $13.50.
