Neighborhood Intelligence — formerly known as Bed Bath & Beyond Inc. — is exploring alternatives to its deal with real estate platform Fathom Holdings, which was originally announced in June.
The new deal would leverage “substantially all” of Neighborhood Intelligence’s digital assets, contributing to Fathom nearly 40% direct and indirect ownership interest in tZero Group, its Medici-related fund assets and its direct investment in GrainChain.
The proposed deal, which would replace the merger agreement made in June, attributes at least $130 million in value to those digital assets contributions, the companies said in a joint press release Thursday. It entails newly issued Fathom shares to Neighborhood Intelligence; the share count will be determined as the deal terms are finalized, with Neighborhood Intelligence expecting to maintain a controlling interest in Fathom.
The deal’s value is not derived from Fathom’s current market capitalization, according to Neighborhood Intelligence Executive Chairman and CEO Marcus Lemonis, noting that Fathom’s share price is lower than it was when the deal was originally announced three months ago.
However, “we believe its brokerage and title businesses have made meaningful progress during that same period,” he said in a statement. “The proposed structure is intended to recognize both that progress and the value we believe exists in the digital asset portfolio Neighborhood would contribute.”
The newly proposed deal also allows Fathom to pursue relevant acquisitions that would strengthen its operating business.
“The companies believe that real estate represents a natural application for tZERO’s digital securities infrastructure, including potential tokenization of commercial real estate and single-family rental portfolios, more flexible capital structures and new pathways to liquidity,” they added. “Over time, the companies also intend to explore applications involving title services and individual homeownership.”
Neither Neighborhood Intelligence nor Fathom Holdings immediately responded to requests for additional comment around the newly proposed deal or when the acquisition might close.
The original deal announced in June involved Neighborhood Intelligence acquiring Fathom in an all-stock transaction valued at about $53 million. At the time, the two companies expected the acquisition to close in the second half of the year.
The reworked deal with Fathom comes just weeks after Neighborhood Intelligence canceled its deal to acquire F9 Brands, the owner of Cabinets to Go and Lumber Liquidators, valued at $150 million. At the time, Neighborhood Intelligence said “F9 was unable to satisfy all closing requirements within the contemplated timeframe.”
Those deals — which were part of Neighborhood Intelligence’s strategy to move beyond just traditional retail, into home services and home ownership — followed a slew of other acquisitions the company inked, including with The Container Store and The Brand House Collective (formerly Kirkland’s Inc).
