CoStar to Buy Vexcel for $730M Cash; Q3 Revenue $952M, Adjusted EBITDA Doubles
CSGP sits 36% above its 52-week low of $25.894.
Summary
CoStar agreed to acquire aerial imagery provider Vexcel for $730 million in cash, expected to close in Q1 2027, while reporting Q3 revenue of $952 million and doubling Adjusted EBITDA to $229 million with raised 2026 guidance.
Key Events · M&A and Partnerships · CSGP
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CoStar Signs $730M Vexcel Deal
Definitive merger agreement to acquire Vexcel Group for $730 million in cash, adding an aerial imagery program covering 45+ countries and 99.6% of the U.S. population.
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Funding From Cash and Revolver
CoStar expects to fund the purchase from cash on hand and its existing revolving credit facility; the deal carries no financing condition. Cash stood at $500 million at September 30, 2026.
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Q1 2027 Close, HSR Review
Closing is targeted for the first quarter of 2027 subject to HSR and foreign regulatory clearance, with a July 27, 2027 outside date and a $29.2 million reverse termination fee payable by CoStar if antitrust blocks the deal.
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Q3 Earnings and Raised Guidance
Q3 revenue was $952 million, up 14%, net income $74 million and Adjusted EBITDA $229 million, doubling year-over-year; full-year 2026 Adjusted EBITDA guidance rose to $820-840 million.
Analysis · CSGP · Trade & Services
CoStar has signed a definitive agreement to acquire Vexcel, an aerial imagery and geospatial data provider with more than $140 million in trailing revenue growing over 30%, for $730 million in cash funded from cash on hand and its revolver. The deal carries no financing condition and is expected to close in Q1 2027 after HSR and foreign regulatory clearance, with a $29.2 million reverse termination fee if antitrust blocks it. Alongside the acquisition, CoStar delivered Q3 revenue of $952 million and Adjusted EBITDA of $229 million, doubling year-over-year, and raised full-year 2026 Adjusted EBITDA guidance to $820-840 million. The acquisition deepens CoStar's proprietary data moat for AI-driven property analytics, but it consumes a meaningful slice of the $500 million cash balance reported at September 30, 2026, leaving the revolver to carry the rest.
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At the time of this filing, CSGP was trading at $35.09 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $13B. The 52-week trading range was $25.89 to $79.08. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.