Under the terms of a share purchase agreement dated Sept. 23 among Real, LemonBrew Lending, and LemonBrew Technologies Corp., Real acquired 100% of the issued and outstanding equity interests of LemonBrew for an aggregate purchase price of $1.25 million.
According to Real, the purchase price was paid with $800,000 in cash and by issuing 351,837 common shares at $1.279 per share. The share price is equal to the product of $450,000 divided by the five-day volume weighted-average trading price of Real’s common shares on the NASDAQ immediately prior to the closing, the company said.
Real said the acquisition broadens its product portfolio to include mortgage brokerage services, and described it as a critical step in its mission to “offer a seamless end-to-end homebuying experience that removes pain points for both agents and their customers.”
With Real’s earlier acquisition of Expetitle, a digital title and settlement company now operating as Real Title, Real has added mortgage and title capabilities to its growing brokerage platform in 2022.
Licensed as a mortgage brokerage in 20 U.S. states, LemonBrew Lending provides the foundation for Real to offer consumers the ability to finance their home purchases with Real, removing the need to work with multiple service providers, the company said.
“LemonBrew Lending’s current mortgage capabilities and future lending potential brings us one step closer to our strategy of providing consumers a frictionless homebuying experience,” said Tamir Poleg, chairman and CEO of The Real Brokerage.
LemonBrew Lending CEO Samir Dedhia said his team is excited “to take the mortgage lending platform we have developed to the next level, and couldn't be happier that we get to do this in partnership with Real's best-in-class technology.”
Real said that, in addition to closing on the acquisition, it also entered into agreements with management and key employees of LemonBrew Lending. The agreements provide for performance-based milestone payments of $2.5 million payable over 36 months following the closing, of which $2 million will be payable in cash and $500,000 in restricted share units of the company, it said.
Founded in 2014 and based in Toronto, The Real Brokerage Inc. serves 44 states and the District of Columbia in the U.S. and three Canadian provinces with over 7,000 agents.