(Reuters) – Australian online property settlement firm PEXA Group Ltd said on Thursday it will acquire UK-based remortgage processing firm Optima Legal, at a time when rising interest rates are expected to push people to switch their lenders.
The Melbourne-based company will assume Optima Legal’s about 22% share of the United Kingdom’s remortgage market and will get access to direct relationships with six of the country’s top eight lenders, it said in a statement.
Remortgaging involves transferring of mortgage on an existing property from one bank to another. With UK interest rates at their highest since 2008 and seen rising further, borrowers may switch lenders for a better deal.
“Given the significant volume of remortgaging activity in the UK market – and with volumes expected to increase as interest rates continue to rise – more streamlined systems are urgently needed,” PEXA Group Chief Executive Officer Glenn King said.
The acquisition also comes as more Australians take out a mortgage for a new home but hold out for a good deal on their old place, forcing them to hold a bridging loan to cover their previous mortgages.
The deal announcement came just before the Australian competition regulator approved the acquisition of PEXA’s top shareholder Link Administration Holdings by Canadian software firm Dye & Durham Ltd (D&D). (https://bit.ly/3KYE70i)
The buyout is subject to D&D selling its existing Australian businesses to a purchaser approved by regulator, it said.
Link owns a 42.8% stake in PEXA, which has been the centre of attraction for multiple buyout offers for Link over the past two years.
(Reporting by Sameer Manekar in Bengaluru; editing by Uttaresh.V)
