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ompass has made a significant move in the industry with its acquisition deal for @properties and Christie's International Real Estate. This deal is just one of several milestones achieved by Compass this year, including being cash-flow positive in all three quarters and reaching nearly $21 million in profit during the second quarter. The company has also seen its coffers grow from $167 million to $211 million.

    Compass is paying around $150 million in cash and $294 million in stock for @properties, Christie's International Realty, and affiliated firms. This deal gives Compass access to international markets and affiliate programs, solidifying its position in key markets like Chicago and Atlanta. Finley Hair, national director of M&A Advisory at WAV Group, calls the move "brilliant" and predicts it will be remembered as one of the decade's top real estate deals.

    As part of the deal, @properties' ownership team will receive 44 million shares in Compass, making them the company's fourth-largest shareholder. The brokerage has undergone a shift in ownership this year, with CEO Robert Reffkin decreasing his holdings and Softbank selling 7.5 million shares. To fund the cash portion of the deal, Compass will draw on its cash balance and revolver while maintaining a cash position above what it draws.

    The deal is expected to close in early 2025, a typically lower cash-generating period for the company. Compass expects to pay another $29 million in antitrust settlement payments in the second quarter. The company's post-synergy transaction multiple is a key metric to watch, with a target of five to six times adjusted EBITDA.

    Compass projects $500 million in added revenue in the first year after the deal, with an adjusted EBITDA of $49 million. However, some analysts caution that cost savings from mergers are often overestimated. Despite this, Compass' acquisition is seen as a strategic move to boost growth and satisfy investors. The company's ability to grow organically has been questioned, making acquisitions necessary for continued success.

    Compass closed two deals this year, contributing to its strong transaction growth in a difficult housing market. Analysts believe that companies showing above-market growth will be rewarded by the market, while those failing to meet expectations will face criticism. The acquisition opens new growth strategies through Christie's high-margin affiliation model and title and mortgage business.

    The deal has not yet been rewarded by the market, with Compass' stock closing nearly even with its opening price of $7.07. However, experts believe that this move will give Compass a head start on hitting its growth targets for next year.