Zoopla to pay £75m for Property Software Group

Zoopla Property Group was preparing to take another property services business under its wing on Tuesday, announcing the £75m acquisition of the Property Software Group (PSG).

The FTSE 250 digital media and lead generation platform described PSG as the UK’s market-leading provider of software solutions to property professionals, and claimed it is used in more than 8,000 agency branches.

Consideration for the deal will total £75m on a cash-free, debt-free basis, with £47m cash payable on completion. £22m will be payable six months after completion, and £3m will be payable 12 and 24 months after completion.

The transaction will be funded from the group’s existing cash, as well as a £50m extension of its current debt facility.

In the year ended 31 March, PSG generated revenues of £15.9m and adjusted EBITDA of £5.1m, with 84% recurring revenues and a customer retention rate of over 97%.

Zoopla’s board said the acquisition of PSG was a core part of its continued mission to be the most effective partner for UK property professionals, and will enable the enlarged group to offer agents an end-to-end solution including software and CRM, digital marketing and market insight tools, and further revenue opportunities.

"This acquisition is a game-changer, combining ZPG's best-in-class property marketing solutions with PSG's best-in-class property workflow solutions, and will transform the services available for both UK agents and consumers,” said Zoopla Property Group founder and CEO Alex Chesterman.

"We will be able to offer UK property professionals an unrivalled proposition supporting them with their software and CRM solutions, digital marketing requirements, market insight tools along with providing them a range of new revenue opportunities through PSG's MoveIT platform.

"Our ambition has always been to be the most effective partner to the UK property industry and this deal will allow us to work more closely with our agent partners and offer them an even more compelling service. I look forward to welcoming Mark and his team to the ZPG family,” he added.

Post completion, PSG will continue to operate as a standalone platform and brand with business as usual.