The rumor that real estate site Zillow was buying its chief rival Trulia surfaced last week in a Bloomberg report. This morning it was confirmed.
Zillow and Trulia’s boards had approved a $3.5 billion stock-for-stock transaction. Both companies are public. The deal will create a dominant digital real estate company in the U.S. market. The closest rival will be Realtor.com, operated by the National Association Of Realtors.
Traffic data provided by the companies showed Zillow with 83 million unique users in June, across platforms. Trulia had 54 million uniques. Both companies have widely used mobile apps.
According to the Zillow press release and a NY Times interview with CEO Spencer Rascoff, the companies will maintain distinct sites and identities after the deal closes next year:
The two brands have limited consumer overlap – approximately half of Trulia.com’s monthly visitors do not visit Zillow.com, and approximately two-thirds of Zillow.com’s monthly visitors across all devices do not use Trulia.com. Maintaining the two distinct consumer brands will allow the combined company to continue to offer differentiated products and user experiences, attract more users and maximize the distribution of free content across multiple platforms, apps and channels.
Rascoff told the NY Times that Zillow’s goal “is to create a portfolio of real estate properties, becoming more along the lines of an IAC/InterActiveCorp.” Trulia CEO Pete Flint will continue to run that site and report directly to Zillow’s Rascoff. He will also join the combined company board.
The $3.5 price is a 25 percent premium above Friday’s closing price for Trulia, which had seen its stock jump on takeover rumors last week.
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