CoStar Continues to Court REIS


CoStar Group is hoping to further expand its presence in the commercial real estate information market with another offer to acquire New York-based commercial real estate market information provider REIS. CoStar's latest proposal, announced this week, outlines the company's plan to acquire all the fully diluted shares of REIS common stock for a per share consideration of $8.75, all cash with no financing contingency. The all cash proposal represents a premium of approximately 97 percent above the closing price of REIS common stock on Aug. 12, 2008.

CoStar initially offered to buy REIS at $8.75 a share back on June 5. But on June 20, Lloyd Lynford, CEO and president of REIS, responded that REIS was not interested in the deal. While REIS's stock price has dropped since June, CoStar is still very interested in combining the resources of both companies, according to a press release this week that includes a letter CoStar CEO and president Andrew Florance sent to Lynford on Aug. 12.

It will be interesting to see how REIS responds to CoStar's latest offer. CoStar officials apparently feel very strongly that the combination of resources of CoStar and REIS would create a powerful information source for the commercial real estate marketplace; and certainly, customers of both would benefit greatly from a service that pools the resources of these information providers. At the same time, the companies could likely improve efficiencies and cut costs by consolidating some operations.

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