11:17 AM EDT, 03/10/2025 (MT Newswires) -- Rocket (RKT) said Monday that it will acquire real-estate brokerage Redfin (RDFN) for an equity value of $1.75 billion in a deal that's expected to drive users to Rocket's home-lending business.

Redfin's investors will get 0.7926 common share of Rocket in exchange for each Redfin share held, reflecting a per-share value of $12.50, the companies said. That fixed exchange ratio represents a 63% premium over the latter's volume weighted average price for the 30 days through last Friday.

Separately, Redfin said that it valued the deal at $2.4 billion.

The deal is set to close in the second or third quarter, according to the joint statement. Redfin's shares were up almost 70% in Monday trade, while Rocket slumped 15%, erasing gains made over the past week.

"Rocket and Redfin have a unified vision of a better way to buy and sell homes," Rocket Chief Executive Varun Krishna said in the statement. "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."

Rocket said it will leverage Redfin's nearly 50 million monthly visitors on its home search platform, and expects to drive "significant" revenue synergies across search, real estate brokerage, mortgage origination, title and servicing. Rocket sees more than $200 million in run-rate synergies for the combined company by 2027.

It anticipates the deal will boost its adjusted earnings per share by 2026. That's after the company swung to a full-year profit in 2024 of $0.23 a share, compared with a year-earlier loss of $0.07. Redfin's full-year loss widened to $1.36 a share from $1.16 in 2023, it said on Feb. 27, even as revenue rose 7% in the period.

"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," Redfin Chief Executive Glenn Kelman said in a note on the company's website. Kelman will likely continue leading Redfin and report to Krishna.

After the deal is done, current Rocket shareholders are expected to own around 95% of the combined firm, with Redfin investors having about 5%.

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