PropTiger, a News Corp backed online real estate startup, has today announced that it has acquired SoftBank-backed Housing.com in an all-stock deal. However, the valuation of the deal remains undisclosed.
As a part of this transaction, REA Group Limited will invest $50 million in the joint entity with an affiliate of SoftBank Group Corp, investing USD 5 million.
While the deal valuation has not been revealed, several media reports suggests that the Housing.com is valued at around $70-75 million, while PropTiger is valued at around $200-210 million. The valuation of the new combined entity stands somewhere between $270-$285 million.
Post acquisition, Dhruv Agarwala, CEO of PropTiger, will serve as CEO of the joint entity. Jason Kothari, who was brought in as CEO of Housing.com after the sacking of Rahul Yadav, has decided to move on to pursue other opportunities in the Indian Internet space. He will continue to be an advisor to the joint entity through the end of February, 2017.
Jason Kothari, CEO of Housing.com added,
I am proud of the exceptional progress the Housing team and investors have achieved together in the past 18 months. Housing.com’s partnership with PropTiger is the next transformational step to realize our vision of becoming a full-service online-to-offline real estate services company. Housing.com and PropTiger share similar values – to provide trust, transparency and simplicity to the home buying journey. The joint entity will be well-positioned to establish market leadership in a large and rapidly changing marketplace. As I move on to my next opportunity, I am glad to leave behind a strong foundation.
The joint entity will draw on strengths of PropTiger, Housing.com and Makaan.com to offer a unique holistic experience to consumers, real estate developments, brokers and homeowners. PropTiger is the largest online residential real estate brokerage firm, having completed transactions worth $1.5 billion since its founding in 2011, while Housing.com is India’s most popular online platform for buying and selling homes, receiving over four million visits every month.
The joint entity will be the only player in India offering the full range of online and offline services in the real estate space, such as personalized search, virtual viewing, site visits, legal and financial diligence, negotiations, property registration, home loans and post- sales service.
Speaking on the partnership, Dhruv Agarwala, Co-founder & CEO of PropTiger said,
We are excited to join hands with Housing.com. The deal is a continuation of our efforts to bring best in class services to consumers and create a unified technology driven platform that is capable of serving all needs of consumers, developers and brokers with respect to buying selling and renting of homes. Housing has established itself as a formidable online brand and we admire its consumer centric product innovation. The timing of this deal is just right.
This deal will strengthen PropTiger’s full stack Online-to-Offline (O2O) services proposition. In April, 2015, PropTiger acquired online classifieds platform Makaan.com to launch India’s first O2O platform, aiding consumers throughout their home buying journey, from initial search and discovery to the final step of transaction closure.
Henry Ruiz of REA Group, Simon Barnett of News Corp and Jonathan Bullock of SoftBank Group International will join Raju Narisetti (chair), Ravi Adusumalli from SAIF Partners and Prashanth Prakash from Accel Partners as investor directors on the board of the joint entity.
The combined entity will now target the real estate advertising and transaction services market, which is currently worth $5 billion and expected to grow to $7 billion by 2020.
Housing.com had started struggling when its co-founder Rahul Yadav was fired post his falling out with the investor-controlled board of directors in 2015. This subsequently led to exit of other co-founders too.
Then, Softbank brought Jason Kothari, as an outsider CEO. After that, the company was rumoured to be on merger talks with ecommerce marketplace Snapdeal, which fell flat post exit of Nikesh Arora from Softbank.