Realogy Holdings Corp., a residential real estate services company based in Morristown, said Thursday it is selling its global relocation business to SIRVA Worldwide Inc., a subsidiary of the global relocation firm SIRVA Inc., for $400 million.
The deal includes all of the relocation assets of Realogy’s Cartus subsidiary, but does not include its Cartus Affinity business or its Broker Network.
Under terms of the agreement, Realogy will receive $375 million at the closing, which is expected in the first half of 2020, and a $25 million deferred payment. Realogy said it will use a majority of the net proceeds to pay down corporate debt and use the balance to reinvest into the business.
“The sale of Cartus’s Relocation business is part of Realogy’s strategy to simplify and streamline our company as we strengthen and hone our value proposition,” Ryan Schneider, CEO and president of Realogy, said. “This transaction will allow Realogy to retain and focus on growing elements of the business that are critical to our value proposition, including our Affinity and other lead generation partnership programs, which benefit from our established Broker Network. It will also allow us to use net proceeds to reduce debt, reinvest in the business, and drive greater long-term value for our shareholders.”
“This acquisition will offer clients broader choice, tremendous program flexibility and a heightened pace of innovation,” Tom Oberdorf, chairman and CEO, SIRVA, said. “SIRVA’s clients will benefit from access to Cartus’s well-established Broker Network, while SIRVA’s integrated household goods capacity will benefit Cartus customers. We believe the investments both companies have made in leading-edge technology solutions, exceptional client service delivery and growth will allow us to create the industry’s most capable, knowledgeable and accessible relocation management company to best serve our existing and future customers.”
Barclays Capital Inc. served as the financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP served as the legal advisor to Realogy. Kirkland & Ellis LLP served as the legal advisor to SIRVA.
