John McGrath exits REA Group board after 18 year stint
Estate agent John McGrath is departing the board of the REA Group.
He has been on the board since its 1999 float. He was its chairman for four years until 2007.
McGrath was an early adopter of new technology, instrumental in seeing the digital real estate website eventually succeeding in what had been a sales industry slow to embrace change. In 2000 McGrath convinced Lachlan Murdoch to take equity, in a deal that saved the small internet start-up from a dotcom implosion. Pamela Williams' book, Killing Fairfax noted the two young men had met on the board of the Museum of Contemporary Art Young Patrons group.
REA Group announced that McGrath will step down from the board on 16 January 2018.
Chairman Hamish McLennan acknowledged McGrath’s service to the Board.
“Mr McGrath’s lengthy contribution to the REA Group has been highly regarded by the board.
"I am particularly grateful for his invaluable industry knowledge.
"He leaves the group with a multi-billion dollar market capitalisation and we wish him the best of luck”.
A search for a new independent director is now being undertaken.
McGrath has been the only board member directly connected to the Australian real estate industry since the 2012 departure of Sam White.
McGrath's final director's interest statement advised he had 146,000 shares which were trading at $74 a share.
McGrath, who began his now listed estate agency in 1988, remains an executive director at the McGrath group.
The REA Group's humble beginnings in 1995 was a garage in Doncaster, in the Eastern suburbs of Melbourne, as noted in Killing Fairfax: Packer, Murdoch and the Ultimate Revenge by Pamela Williams, published by HarperCollins in 2013.
Martin Howell and Karl Sabljak, who had been working at the Royal Melbourne Institute of Technology (RMIT) as computer systems administrators, registered the realestate.com.au URL in August 1995.
In August 1999 Andrew Barnes oversaw negotiations for Macquarie Bank to to buy a controlling stake of 51 per cent for just under $1 million.
With Andrew Barnes as chairman, and 15 million shares issued at 50¢, realestate.com.au was admitted to the Australian Stock Exchange in December 1999.
While it opened at $1.50 a share in December, 1999, it was trading between 15¢ and 20¢ in 2000.
On November 30, 2000, News Limited announced it had invested cash of $2.25 million in realestate.com.au, plus advertising, marketing and other contra for a total investment worth $10.75 million in the deal negotiated by Lachlan Murdoch.
In 2013, Rupert Murdoch expressed his delight at having its REA investment.
"And I don’t remember Lachlan even asking me about it,” he added.
News Limited took an initial 44 per cent stake with an option to acquire a further 10 million shares over the next five years.
Macquarie Bank would remain a shareholder but News would acquire the outstanding amount of Macquarie’s loan facilities.
The digital website company now has a $9.75 billion market capitalisation. News Limited holds 61 percent.
The Domain website at John Fairfax & Sons was launched in October 1999, four years behind realestate.com.au.
In May 2001 Red Sheriff, a company which audited website traffic statistics, revealed realestate.com.au had shot past Fairfax’s domain.com.au with more visitors to its site.
"Horrifyingly for Fairfax, domain.com.au had fallen to second place," Pam Williams wrote.
"It was a moment in time when the advertising world that had been comprehensively dominated by Fairfax showed its first cracks," she wrote.
Now listed separately, Domain's market cap is $1.9 billion.