Key facts
- Compass stock fell 11.8% to $7.61 on Wednesday.
- The New York Attorney General's Office is reportedly investigating Compass on antitrust grounds.
- The probe is reportedly linked to Compass's $1.6 billion acquisition of Anywhere Real Estate.
- The combined entity is the largest residential real estate brokerage in the US with over 340,000 agents.
- The DOJ's antitrust division had previously considered investigating the merger but decided against it after an appeal.
Compass Inc.'s stock price fell 11.8% to close at $7.61 on Wednesday, following a report by The Real Deal indicating that the New York Attorney General's Office may be investigating the company on antitrust grounds. Agents from the AG's antitrust division have reportedly contacted leaders at several top New York City brokerage firms to gather information regarding Compass International Holdings' market dominance. This probe follows Compass's $1.6 billion acquisition of Anywhere Real Estate, which closed earlier this year, creating the largest residential real estate brokerage in the United States with over 340,000 agents and franchisees. Anywhere Real Estate is the parent company of well-known brands such as Corcoran, Sotheby's International Realty, and Coldwell Banker. The merger itself had previously drawn attention from the Department of Justice's antitrust division, which had considered launching an extended review. However, this review did not proceed after Compass appealed to then-Deputy Attorney General Todd Blanche. Senators Elizabeth Warren and Ron Wyden had also previously written to antitrust regulators, urging scrutiny of the deal due to concerns it could lead to artificially high commission fees and increased market control. The stock has experienced a significant decline year-to-date, down 28%, although it remains up 23% over the past 12 months.