R
ocket Cos., a major mortgage lender, is acquiring online real estate brokerage Redfin in an all-stock deal worth $1.75 billion. The acquisition gives Rocket access to over 2,000 real estate agents across 42 states and Redfin's popular platform with nearly 50 million monthly visitors. Redfin shares surged 68.5% to $9.81 after the announcement, while Rocket Cos.' shares dropped 15%.

    The deal is expected to save Rocket around $140 million in costs by eliminating redundant operations and expenses. It also aims to boost revenue by more than $60 million through increased connections between Rocket's clients and Redfin's agents, potentially leading to additional real estate services.

    Redfin CEO Glenn Kelman will remain at the helm of the brokerage under Rocket Cos.' leadership. The deal values Redfin at $12.50 per share, a 63% premium over its average price in the past month. Once finalized, Rocket Cos. shareholders will own around 95% of the combined company, while Redfin shareholders will hold about 5%.

    The companies' boards have approved the transaction, pending shareholder approval from Redfin's investors. The deal is expected to close in the second or third quarter this year.