By Stuart Condie

SYDNEY--U.S. real-estate analytics provider CoStar raised its proposed offer for Domain, telling Australia's second-largest property advertiser that US$1.92 billion is its top price unless a rival suitor emerges.

CoStar, which operates U.S. portals including Homes.com, improved its nonbinding all-cash proposal to 4.43 Australian dollars a share, equivalent to about US$2.79. That is up 5.5% on the A$4.20 it initially proposed last month.

The stock, which has jumped more than 40% since the initial approach was announced, was at A$4.47 before the start of Thursday's session, suggesting that investors were already anticipating a higher offer.

Domain said Thursday that its board planned to unanimously recommend the proposal and to vote in favor. The directors will now engage with CoStar on an exclusivity deed and the process of opening the company's books.

Nine Entertainment, the Australian media conglomerate that owns 60% of Domain's shares, said it supported the board's decision to engage with CoStar. In a separate filing, Nine said it would receive net proceeds of about A$1.4 billion if the transaction advances on the proposed terms.

Analysts have suggested that the sale by Nine of its controlling interest would present an opportunity for significant capital management by the media group.

CoStar's revised proposal comes 15 months after it completed a US$125 million takeover of OnTheMarket, one of the U.K.'s three most-visited residential property portals. At the time, CoStar CEO Andy Florance said his company would integrate OnTheMarket into its network and invest millions of dollars in the U.K. business.

Domain has long labored unsuccessfully to overcome REA Group's first-mover advantage in Australian online property classifieds. News Corp-controlled REA, still the No. 1 player, has a market capitalization of about US$19 billion.

Domain's marketing spend in the six months through December was about half that of REA's, Citi analyst Siraj Ahmed noted last month.

CoStar, which doesn't have any existing regional interests, could seek to leverage its existing tech stack to boost Domain's engagement with consumers. Last year, CoStar bought 3-D property mapping provider Matterport in a US$1.6 billion deal, acquiring the ability to offer virtual property tours to potential buyers.

News Corp owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal.

Write to Stuart Condie at stuart.condie@wsj.com

(END) Dow Jones Newswires

March 26, 2025 19:37 ET (23:37 GMT)

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