R
ocket Companies, the nation's largest mortgage lender, has agreed to acquire Redfin in a $1.75 billion deal that will bring together two companies with a shared vision of revolutionizing the homebuying experience. The acquisition values Redfin at more than double its market capitalization prior to Monday's announcement.
Redfin CEO Glenn Kelman will continue leading the company, and it will maintain its brand. Once the deal closes, Rocket and Redfin will form a technology company with the national scale of a lender, brokerage, title company, and home-search site. This union will enable them to do things they previously only dreamed about.
The acquisition is expected to give Redfin more exposure and access to data that can boost its AI algorithms. Kelman said this will allow customers to schedule home tours, find out what they can afford, and get pre-qualified for a loan in minutes. The combined company aims to be better at building lifelong relationships with customers who need financial advice before or after purchasing a home.
Rocket's CEO Varun Krishna described Redfin as a "data powerhouse" and said the acquisition will improve the experience by connecting traditionally disparate steps of the search and financing process. Redfin attracts nearly 50 million visitors to its platform each month, and the company employs over 4,000 people across 42 states.
The deal is expected to close in the second or third quarter and generate more than $200 million in "run-rate synergies" by 2027. Shares of Redfin were up more than 70% in pre-market trading Monday, while Rocket stock was down 10%.
