Paul Little's private property company Little Group has made a $60.7 million offer for listed real estate services group Real Estate Corp.
The 37 cent a share cash offer has been recommended by the directors of the once-financially stricken group. The directors together hold 58 per cent, giving Little Group control of the company.
Mr Little, former chief executive of Toll Group, said the transaction would give the real estate services arm of Little Group, which is more known for its apartment development projects, a greater profile in the real estate services market.
Real Estate Corp, the biggest rent manager, has some 15,000 properties on its books nationally.
"This transaction will also give us the ability to flesh out the service levels we think are important in our chosen area of the real estate market," he said.
Mr Little said he was yet to decide whether to change the Run Corp name, which is well known for rental management in Melbourne, to the name Little, but said it would make sense to change the brand.
Little Group has a development pipeline exceeding $1 billion, mostly in Melbourne.
The group already manages 3000 properties, mainly in Victoria.
It has increased its property sale capacity through the acquisition of some big-name real estate agencies in Melbourne over the years. Mr Little said growing the company's service arm was part of his desire to deploy the type of "integrated" business model that was often cited as driving Toll's success.
"It really is about understanding what the customer wants, and I think quite often in real estate the service offering has been closeted around components in the industry," he said.
"As we started to break down some of the barriers and offer not just the opportunity for someone to buy one of our apartments but then for us to rent it for them and then one day sell it for them, we've found a huge interest in embracing this integrated or seamless approach to real estate." Little Group's takeover offer for Real Estate Corp comes after a separate $65.7 million offer from Western Australia's Rental Management Australia fell over last year.
The cash offer for Real Estate Corp was welcomed by the directors of the company, which has suffered some tough financial times over the past few years as it focused on improving its technological capabilities.
Mr Little said the group's technological platform, which is used by several top real estate companies, was a significant addition to the Little Group.