CoStar is withdrawing its multi-billion dollar bid for CoreLogic after recently dropping its offer from its original $6.9 billion proffer to about $6.6 billion.
In a press release announcing its decision, CoStar said it believes rising interest rates will negatively impact the outlook for the mortgage refinancing market. Accordingly, these rising interest rates have caused valuations for residential property technology companies to decline significantly in recent weeks, which has changed CoStar’s view of the value of CoreLogic. “With interest rates moving up, now is not the time for us to aggressively buy into the residential mortgage market,” said CoStar CEO Andrew C. Florance in prepared remarks.
CoStar Group still made the case that a strategic combination between the two companies would have created significant value. However, it added that it is “committed to maintaining its disciplined approach to valuation as it pursues strategic acquisitions.”
CoStar’s exit from the acquisition negotiations presumably means Stone Point and Insight Partners will ultimately win CoreLogic. Last month, prior to CoStar’s bid, the two companies offered to acquire CoreLogic for $6 billion, which the company accepted.