The primary shareholders of REcolorado — the Denver Metro Association of Realtors (DMAR) and the South Metro Denver Realtor Association (SMDRA) — have fired the current board and announced the name of the company they are selling their shares to: MAZL, LLC., headed by J. Burks.
According to a statement released Friday from DMAR and SMDRA, their board members have “signed and submitted a joint, unanimous resolution removing all REcolorado board members from their position and duties, effective immediately. This decision and action were taken as a result of the violation of the board of directors’ signed obligations to maintain confidentiality.”
REcolorado is a multiple listing service (MLS) with 26,000 members. Its board members and leadership were surprised last week when they received a letter of intent from DMAR and SMDRA to sell to MAZL since they had been in negotiations to buy the MLS since February. Some members of REcolorado went public with the sale on Monday, seemingly prompting today’s action. The statement from DMAR and SMDRA says that 4 of the 11 REcolorado board members resigned in protest over the last few days over the other board members’ actions.
The statement from DMAR and SMDRA board members outlined why they fired the remaining seven board members. “While disappointed, we have come to this decision based on the egregious violation of confidentiality and signed Non-Disclosure Agreement (NDA) carried out by a representative(s) of the REcolorado board of directors. Coupled with the response of the REcolorado board of directors over the past several days we have reached this decision which we believe is in the best interests of our collective membership, our long-term ownership and operational goals.”
Comments from the four resigning board members were included in the statement, although not their identities. One comment said, “Leadership has lost sight that the shareholders own the company and have the right to determine its ultimate course of action.” Other comments noted support for the shareholders and their actions.
DMAR and SMDRA acknowledged the sale in a statement Tuesday night, seeking to reassure its members. “Having completed our due diligence as shareholders, we feel confident in the letter of intent and that the proposed buyer has committed to the long-term operation of the MLS service for our professional brokerage community and that the resources of the MLS will be used to enhance the service offerings to all subscribers and that the company will not be resold.”
In their own statement released Wednesday night, the REcolorado board warned Denver-area Realtors that outside ownership of the local MLS could bring added uncertainty. While the statement said it supported the effort to decouple the local MLS from DMAR and SMDRA, the MLS said it objects to the associations selling it to an outside private equity firm.
“We disagree with their approach and are dedicated to keeping REcolorado a broker-focused business partner and will continue to pursue all options to make certain your MLS remains a locally owned organization that is operated in your and your clients’ best interest,” the statement reads.
The new buyer
Today’s statement from DMAR and SMDRA say the new buyer, Burks, is “a leader in the real estate industry for more than 40 years.” His company, MAZL, is “a private company formed specifically for the purpose of acquiring the MLS service.”
“With this change in ownership, our commitment to providing a broker-centric platform remains steadfast,” Burks says in the statement. “We assure the subscribers that REcolorado will continue to operate as a Multiple Listing Service, maintaining its core mission of delivering exceptional data, tools and resources to Realtors® and licensees. We are dedicated to ensuring that the MLS remains a trusted, broker-focused, true partner that subscribers can rely on.
Sale price and timeline for the completion of the transaction were not disclosed.
