Acquisition of Hometrack

31 January 2017

Zoopla Property Group Plc

ZOOPLA PROPERTY GROUP TO ACQUIRE HOMETRACK FOR £120 MILLION

Strategic highlights

● Hometrack is the UK's leading provider of residential property market insights

● Combination creates the UK's most valuable residential property resource

● Core part of ZPG's stated strategy to develop its data services business

● Empowers consumers with even more useful, accurate market information

● Provides partners with market-leading valuation tools and data intelligence

● Strong position in Australian market with significant growth opportunities

● Subscription model with strong track record of revenue growth & profitability

● Clear synergies to accelerate and broaden ZPG's data services opportunities

● Expected to be earnings & margin enhancing on an adjusted basis in first full year1

Zoopla Property Group Plc (LSE:ZPLA) ("ZPG" or the "Company"), owner of some of the UK's most trusted digital platforms including Zoopla, uSwitch, PrimeLocation and Property Software Group, today announces that it has agreed to acquire Hometrack.co.uk Limited ("Hometrack"), the UK's leading provider of residential property market insights and analytics, for £120 million on a cash-free, debt-free basis (the "Acquisition").

Established in 1999, Hometrack is the UK's #1 automated valuation model ("AVM") provider and one of the leading AVM providers in Australia, generating over 20 million automated property valuations per annum. Hometrack provides residential property market insights, analytics, valuations and data services to over 400 partners including mortgage lenders, new home developers, investors, housing associations and local authorities.

Hometrack has an impressive financial track record with revenue CAGR of c.15% from FY13-FY16 and generated revenues of £15.5 million and adjusted EBITDA of £7.1 million in the year to 30 June 2016. The business provides its market-leading products to 15 of the top 20 mortgage lenders in the UK as well as all 4 leading Australian mortgage lenders and its UK AVM is recognised by all the major ratings agencies. Over 70% of Hometrack's revenues are subscription-based and underpinned by long-term relationships.

The acquisition of Hometrack is another important step in ZPG's mission to provide the most useful resources to consumers when finding, moving or managing their home and be the most effective partner for related businesses. The combination brings together two of the UK's leading residential property market insights and data providers, creating the most valuable residential property resource in the UK.

Hometrack has a strong management team with deep data, property market and analytical expertise and has 55 staff operating out of offices in London and Sydney. Following completion, Hometrack will continue to operate as a standalone brand and platform with the team forming the cornerstone of ZPG's data services business, which will be headed up by Charlie Bryant, CEO of Hometrack.

Transaction highlights

● Consideration of £120 million on a cash-free, debt-free basis with £108 million due on completion and £6 million payable on each of the first and second anniversary following completion2

● The Company expects the Acquisition to be earnings and margin enhancing on an adjusted basis in first full year1

● Acquisition to be financed through a combination of existing cash resources, a new £75 million term loan and an equity placing of up to 5% of ZPG's ordinary issued share capital, which has been separately announced today

● Strong deleveraging profile due to cash generated by the Company with opening net debt ratio of c.2.5x the enlarged Company's adjusted EBITDA

● The Company will maintain its current dividend policy of 35%-45% payout ratio of the enlarged Company's profit after tax

● Represents a 14.7x multiple based on LTM to Dec-16 Adjusted EBITDA for Hometrack3

● Increased interest charge of c.£2m p.a and additional acquired amortisation charge currently estimated to be c.£9m p.a

● Hometrack deal-related exceptional costs of c.£7m in FY17, c.£5m in FY18 and c.£2m in FY194

● The value of Hometrack's gross assets was £13.1m as at 30 June 2016

The Company is currently in negotiations on a potential further smaller acquisition5, which would be complementary to ZPG, and is expected to complete within the next few months. Discussions relating to this potential acquisition are ongoing and there is no guarantee that it will complete.

Outlook

The Board is pleased with current trading across both its divisions. In the Property Services division, the number of UK Agency partners has continued to grow since year end and the Comparison Services division continues to enjoy solid switching volumes across each of its verticals.

ZPG continues to invest in developing its integrated proposition and Management look forward to the rollout of a number of new and innovative products for both its consumers and partners during 2017. The Company's next scheduled update will be its half-year results on 24 May 2017.

Commenting on today's announcement Alex Chesterman, Founder & CEO of ZPG said, "We are delighted to announce the acquisition of Hometrack, the clear market leader in AVM services in the UK and a leading player in Australia. The deal will allow us to serve our consumers and partners even more effectively and gives us unrivalled data capabilities in the residential property market. Hometrack is a perfect fit to develop our data services business and I look forward to welcoming Charlie and his team to the ZPG family."

Commenting on the Acquisition, Charlie Bryant, Chief Executive Officer of Hometrack said: "We have had a long-standing relationship with ZPG and share the same vision of using data to help our partners operate more effectively. My team and I are very much looking forward to helping expand ZPG's data services business, further growing the quality and breadth of the services we offer to our partners and cementing ZPG as the market leader for residential property market insights and analytics."

This announcement contains inside information.

-ENDS-

For further information, please contact:Lawrence Hall, Head of Communications - [email protected] / 07890 078 945Rachael Malcolm, Head of Investor Relations - [email protected] / 0203 8725 648Jais Mehaji / James Isola, Maitland 020 7379 5151http://www.zpg.co.uk/

1 Adjusted is defined as operating profit after adding back depreciation and amortisation, share-based payments and exceptional items including deal-related costs

2 Potential further earnout of up to a maximum of £25m payable over up to 10 years contingent on performance of certain future contracts

3 Hometrack generated c.£17.1m of revenues and c.£8.2m of adjusted EBITDA in the 12-month period ending 31 Dec 16 (unaudited)

4 Deal-related exceptional costs include transaction costs, deferred consideration costs and performance bonus payable to management sellers

5 This potential acquisition is likely to be classed as an Unclassified Transaction, according to the UKLA's Class Tests in LR10 Annex 1

An investor and analyst call hosted by the ZPG management team will take place at 09.00am tomorrow morning and dial in details are as follows below:

UK Toll Number: 020 3003 2666

UK Toll-Free Number: 0808 109 0700

United States Toll-Free Number: 1866 966 5335

United States Toll Number: 1 646 843 4608

Participant pin: 7736784#

Password: 76156743About Zoopla Property Group (www.zpg.co.uk)

Zoopla Property Group Plc (LSE:ZPLA) ("ZPG") owns and operates some of the UK's most trusted home-related digital platforms including Zoopla, uSwitch, PrimeLocation and Property Software Group. Our mission is to provide the most useful resources for consumers when finding, moving or managing their home and be the most effective partner for related businesses.

We help consumers to understand the property and home services comparison markets and make smarter decisions, whilst helping professionals win more business and operate more effectively. Our multi-brand, multi-channel approach creates a unique and unrivalled proposition with our websites and mobile apps attracting over 50 million visits per month and over 23,000 businesses using our services.

Zoopla is the UK's most comprehensive property website, helping consumers to research the market and find their next home by combining hundreds of thousands of property listings with market data and local information.

uSwitch is the UK's leading comparison website for home services switching, helping consumers to find the best deal and save money on their gas, electricity, broadband, TV, phone and personal finance products.

PrimeLocation is one of the UK's leading property websites, helping house-hunters in the middle and upper tiers of the market explore and find their dream home from the top estate and letting agents.

Property Software Group is the UK's largest supplier of software and workflow solutions to the property industry with a portfolio of brands including Alto, Jupix, CFP, Vebra, Core, Encore, MyPropertyFile and MoveIT.

ZPG was founded in 2007 and has a highly experienced management team, led by Founder & CEO, Alex Chesterman OBE.

About Hometrack

Established in 1999, Hometrack is the UK's #1 automated valuation model ("AVM") provider and one of the leading AVM providers in Australia, generating over 20 million automated property valuations per annum. Hometrack provides residential property market insights, analytics, valuations and data services to over 400 partners including mortgage lenders, new home developers, investors, housing associations and local authorities.

Hometrack currently partners with 15 of the top 20 mortgage lenders in the UK as well as all 4 leading Australian mortgage lenders and its UK AVM is recognised by all major ratings agencies.

IMPORTANT NOTICE

The securities referred to herein will not be or have not been registered under the US Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.