Floating of Fairfax’s Domain division gathers momentum but with wide-ranging market capitalisation expectations

The likelihood of Fairfax spinning-off its Domain property listings division into a separate ASX-entity appears to be gathering momentum with its own platforms reporting on a possible float.

The strongly-growing Domain business, which includes both print and online listings as well as its joint venture with Anthony Catalano’s Metro Media Publishing arm (publisher of The Weekly Review), was hived off into its own division in April this year as part of a Fairfax Media restructuring.

The accompanying media release to announce the restructure did not name who would head up this division with industry speculation that Catalano, the former Age property editor and marketing manager, might be chief executive of the new listed entity.

Fairfax's head of corporate communications Brad Hatch tells Property Observer Tony Blamey, general manager, real estate at Fairfax Media, is general manager of Domain.

Domain is one of the standout businesses among the struggling media giant’s various newspaper and online ventures.

Fairfax Media reported strong 14% growth in Domain revenues in its interim results for the six months to December 30.

Matthew Kidman, director at Wilson Asset Management and former finance reporter for Fairfax-owned the Sydney Morning Herald wrote in Fairfax’s Business Day this week that based on analysts’ forecasts of $6 million and $40 million earnings (before interest, tax, depreciation and amortisation) Domain could be worth anything from $84 million to $480 million.

The Domain division generates about $80 million in revenue.

It was set up as a separate standalone division with its own dedicated management in April with Fairfax “recognising the significance of the real estate sector”.

The merger between Fairfax and MMP was approved by the ACCC in May last year.

MMP publications have a circulation of 220,000 print editions of its real estate advertising glossy The Weekly Review sent out for free to residents of Melbourne’s well-to-do eastern, bayside and north-eastern suburbs and Geelong.

It also has the reviewproperty.com.au website, which claims around 400,000 property listings.

Even if Domain were to list at the top end of its $480 million range it would be dwarfed by News Limited’s market leader the REA Group, publisher of realestate.com.au, which has a market cap in excess of $3 billion.