RE/MAX Holdings Also Announces Amendment of Credit Agreement
That Increases Capacity and Reduces Borrowing Costs
Proceeds From New Term Loans to be Used to Repay Existing
Indebtedness and Fund RE/MAX INTEGRA North American Regions
Acquisition
DENVER, July 21, 2021 /CNW/ -- RE/MAX
Holdings, Inc. (the "Company" or "RE/MAX Holdings") (NYSE: RMAX),
today announced that RE/MAX, LLC, one of the world's leading
franchisors of real estate brokerage services, has completed its
previously announced purchase of the North American regions of
RE/MAX INTEGRA. With the sale now closed, more than 19,000 agents
(approximately 12,000 in Canada
and 7,000 in the U.S.) and more than 1,100 independently owned and
operated RE/MAX offices are now in the growing group of RE/MAX, LLC
Company-Owned Regions (COR).
"We are delighted to complete this landmark regional
acquisition," said Adam Contos,
RE/MAX Holdings CEO. "The addition of these strategic and
geographically desirable regions enhances our ability to continue
to scale, brings many attractive growth opportunities and
simplifies our operational structure by creating greater
efficiencies. RE/MAX INTEGRA co-founders Frank Polzler and Walter
Schneider have built an impressive network over the 40 years
they've dedicated to growing this brand. Our goal is to continue
their impactful legacy and support the continued growth of these
regions under the RE/MAX, LLC umbrella."
The RE/MAX INTEGRA regions acquired by RE/MAX, LLC include five
Canadian provinces (New Brunswick,
Newfoundland and Labrador, Nova
Scotia, Ontario, and
Prince Edward Island) and nine
U.S. states (the New England states of Connecticut, Maine, Massachusetts, New
Hampshire, Rhode Island,
and Vermont, plus the Midwestern
states of Indiana, Minnesota, and Wisconsin). RE/MAX INTEGRA owns the master
franchise for RE/MAX Europe and
will continue to manage operations there, as it has since 1994.
Acquiring independent RE/MAX regional franchises has long been a
key pillar of the Company's growth strategy and a capital
allocation priority. RE/MAX, LLC has now purchased formerly
Independent Regions covering 21 states, two partial states
(Northern Illinois, Southern Ohio), the District of Columbia and five Canadian
provinces beginning with the Initial Public Offering (IPO) in
October 2013. The acquisition of
INTEGRA's North American regions is the largest manifestation of
this strategy to date.
"Affiliates in the former RE/MAX INTEGRA regions have benefited
from years of strong leadership and innovative technologies and
they can expect that high standard of support and service to
continue," added RE/MAX, LLC President, Nick Bailey. "This acquisition allows us to
drive scale, align and streamline operations across many functions
by delivering the best tools, training and technology at a greater
clip. This is an exciting time for all RE/MAX Affiliates."
Brokerages in Indiana,
Minnesota and Wisconsin are joining the Central Region under
RE/MAX Vice President Dana Tuggle
and the New England offices will join RE/MAX Vice President
Kevin Northrup under the Northeast
Region. Christopher Alexander,
Senior Vice President, RE/MAX Canada and Elton
Ash, Regional Executive Vice President, RE/MAX Canada, will collaborate to lead COR
operations as a unified front in Canada.
RE/MAX has a worldwide network of nearly 140,000 agents in more
than 110 countries and territories, a global footprint larger than
any of its competitors. RE/MAX, LLC is a wholly owned subsidiary of
RMCO, LLC, which is controlled and managed by RE/MAX Holdings,
Inc.
Debt Financing
RE/MAX Holdings also announced today
that RE/MAX, LLC has amended and restated its Credit Agreement to
raise $460 million in term loans and
increase the capacity of the revolving facility to $50 million. RE/MAX, LLC will use the proceeds
from the amended Credit Agreement to repay existing indebtedness of
approximately $225 million and to
fund the $235 million acquisition of
the RE/MAX INTEGRA North American regions.
"We are pleased to take advantage of favorable market conditions
and have accomplished our goal of extending our financing capacity
to bring these regions into the Company-owned fold. We are excited
about the inherent growth potential within our business for years
to come," said Karri Callahan, Chief
Financial Officer of RE/MAX Holdings.
Financial Guidance
RE/MAX Holdings will provide
further details on the transaction, including updated financial
guidance, during the Company's second quarter earnings conference
call to be held on Thursday, August 5,
2021, at 8:30 a.m. Eastern
Time. Interested parties can access the conference call
using the link below:
http://www.directeventreg.com/registration/event/3535213
Interested parties will also able to access a live webcast
through the Company's Investor Relations website at
http://investors.remaxholdings.com/.
About RE/MAX Holdings, Inc.
RE/MAX Holdings, Inc.
(NYSE: RMAX) is one of the world's leading franchisors in the real
estate industry, franchising real estate brokerages globally under
the RE/MAX® brand, and mortgage brokerages within the
U.S. under the Motto® Mortgage brand. RE/MAX was founded
in 1973 by Dave and Gail Liniger,
with an innovative, entrepreneurial culture affording its agents
and franchisees the flexibility to operate their businesses with
great independence. Now with nearly 140,000 agents across over 110
countries and territories, nobody in the world sells more real
estate than RE/MAX, as measured by total residential transaction
sides. Dedicated to innovation and change in the real estate
industry, RE/MAX Holdings launched Motto Franchising, LLC, a
ground-breaking mortgage brokerage franchisor, in 2016. Motto
Mortgage has grown to over 150 offices in almost 40 states.
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the "safe harbor" provisions of the United States
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are often identified by the use of words such as
"believe," "intend," "expect," "estimate," "plan," "outlook,"
"project," "anticipate," "may," "will," "would" and other similar
words and expressions that predict or indicate future events or
trends that are not statements of historical matters.
Forward-looking statements include statements related to the
potential benefits of the acquisition of the RE/MAX INTEGRA North
American regions, including the expectations that the acquisition
will enhance the Company's ability to continue to scale, bring many
attractive growth opportunities and simplify the Company's
operational structure by creating greater efficiencies and cost and
operational synergies; and statements about the growth of
RE/MAX Holdings. Forward-looking statements should not be read as a
guarantee of future performance or results and will not necessarily
accurately indicate the times at which such performance or results
may be achieved. Forward-looking statements are based on
information available at the time those statements are made and/or
management's good faith belief as of that time with respect to
future events and are subject to risks and uncertainties that could
cause actual performance or results to differ materially from those
expressed in or suggested by the forward-looking statements. These
risks and uncertainties include (1) pending acquisition may not be
consummated on the terms described herein, if at all; (2) the
Company's ability to successfully close the anticipated acquisition
and to integrate the acquired regions into its business, (3) the
intended benefits of the acquisition may not be realized, (4) the
global COVID-19 pandemic, which has impacted the Company and
continues to pose significant and widespread risks to the Company's
business, (5) changes in the real estate market or interest rates
and availability of financing, (6) changes in business and economic
activity in general, (7) the Company's ability to attract and
retain quality franchisees, (8) the Company's franchisees' ability
to recruit and retain real estate agents and mortgage loan
originators, (9) changes in laws and regulations, (10) the
Company's ability to enhance, market, and protect the RE/MAX and
Motto Mortgage brands, 11) the Company's ability to implement its
technology initiatives, and (12) fluctuations in foreign
currency exchange rates, and those risks and uncertainties
described in the sections entitled "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" in the most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q filed with the Securities and
Exchange Commission ("SEC") and similar disclosures in subsequent
periodic and current reports filed with the SEC, which are
available on the investor relations page of the Company's website
at www.remax.com and on the SEC website at www.sec.gov. Readers are
cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date on which they are made.
Except as required by law, the Company does not intend, and
undertakes no obligation, to update this information to reflect
future events or circumstances.
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SOURCE RE/MAX Holdings, Inc.