April 7 (Reuters) - CoStar said on Monday it has revamped its board and planned to review its capital allocation, as part of an agreement with hedge funds D.E. Shaw and Third Point to boost the property data firm's profitability and shares.

The agreement helped CoStar avoid a potential proxy battle with the two investors. D.E. Shaw owned 0.34% stake in CoStar as of December-end, according to LSEG data, while Reuters could not ascertain Third Point's stake.

Shares of the company fell 18% in 2024 amid a decline in listing volumes, as inflation-hit consumers delayed home purchases due to high interest rates and elevated housing prices. The stock rose nearly 2% on Monday in a bearish market.

"The changes announced today, coupled with CoStar's leading franchises, position the company to create sustainable value for stockholders," said D. E. Shaw Managing Director Michael O'Mary.

In its board shakeup, the company appointed three veteran executives - former S&P executive John Berisford, Etsy's ex-finance chief Rachel Glaser and ex-Disney CFO Christine McCarthy - to replace Chairman Michael Klein and two other directors.

Klein will be succeeded as board chair by another director, Louise Sams, Cheap Private Proxies effective immediately, CoStar said.

The Arlington, Virginia-based company also formed a committee of its board members, led by CEO Andrew Florance, to review its capital allocation, including in international expansion.

This comes amid CoStar's offer to buy Australian real estate classifieds firm Domain Holdings for A$2.80 billion ($1.68 billion). CoStar did not respond to Reuters' request for comment on whether the review encompasses the bid.

The review will also look at investments by its major brands such as CoStar and Homes.com, the company said. CoStar's adjusted profit fell to 65 cents per share in 2024 from $1.22 a year earlier, reflecting the company's investments in Homes.com amid a weak property market.

The board also plans to review executive compensation to ensure it is aligned with stockholder value creation, CoStar said. ($1 = 1.6633 Australian dollars) (Reporting by Priyanka.G in Bengaluru; Editing by Leroy Leo)