12:35 PM EDT, 04/22/2024 (MT Newswires) -- CoStar Group ( CSGP ) agreed to acquire 3D technology firm Matterport ( MTTR ) in a cash-and-stock deal with an enterprise value of roughly $1.6 billion, the companies said in separate statements Monday.

Investors of Matterport ( MTTR ) will receive $2.75 in cash and CoStar ( CSGP ) shares worth an equal amount, for a total of $5.50 for each share owned, according to the companies. The transaction has an equity value of about $2.1 billion, said Matterport ( MTTR ), whose stock surged 177% in midday trading. CoStar's ( CSGP ) share price increased 0.6%.

Matterport ( MTTR ), which has roughly 440 employees, provides a 3D capture solution offering virtual tours, or "digital twins," of properties. CoStar ( CSGP ), a real estate data provider, currently has 300,000 Matterport ( MTTR ) digital twins available in its information product and online property marketplaces.

CoStar ( CSGP ) expects the acquisition to increase the development and deployment of advanced artificial intelligence and "digital twin" technology across all of its product lines. The group aims to further develop Matterport's ( MTTR ) spatial technology, including the use of generative AI to "imagine and reimagine physical spaces," according to CoStar ( CSGP ) Chief Executive Andy Florance.

The deal, which requires approval from regulators as well as from Matterport's ( MTTR ) stockholders, is expected to close during the year. Directors, officers and other shareholders owning a 15% stake in Matterport ( MTTR ) have pledged to support the transaction, the companies said.

"We believe that this powerful combination will transform how properties are marketed, sold, and managed worldwide," Matterport ( MTTR ) CEO RJ Pittman said in a statement. "Importantly, it offers Matterport's ( MTTR ) stockholders the opportunity to participate in the value creation and future growth prospects of our combined efforts."

Matterport ( MTTR ) in February reported a fourth-quarter adjusted loss of $0.04 per share, in line with market expectations, narrowing from a $0.09 loss the year before. Revenue declined to $39.5 million from $41.1 million, missing the Street's view.

At the time, the company issued a full-year 2024 outlook for its top line to come in between $173 million and $183 million. In the previous year, it recorded revenue of $157.7 million.