Two of the biggest names in India’s startup industry — PropTiger.com and Housing.com — announced today they have merged to form the country’s largest online retail services company.
As part of the deal, the new company will receive a new US$55 million investment. US$50 million will come from REA Group Limited, an ASX-listed company specialising in property, and an affiliate of SoftBank Group Corp. will invest US$5 million.
One of the major players involved in the transaction is Rupert Murdoch’s News Corp. It owns 61.6 per cent of REA Group and will remain the largest shareholder in PropTiger after the deal.
The new company will over O2O services like personalized search, virtual viewing, site visits, legal and financial diligence, negotiations, property registration, home loans and post-sales customer support.
The Economic Times reports that the deal values Housing at about US$70 – US$75 million, less than half of the US$159.2 it has raised from 6 rounds, according to Crunchbase.
PropTiger raised US$30 million from News Corp. in November 2014.
The new company is estimated to be valued at about US$250 million.
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This deal will define the legacy CEO Jason Kothari’s time as head of Housing. He took the reigns of the company after the ousting of Founding CEO Rahul Yadav led to a tumultuous 2015.
Kothari, who will be moving on from Housing after this deal, navigated the choppy waters and, at the time of the merger, the startup was still India’s most popular portal for buying and selling houses. Kothari will stay on as an advisor until the end of February 2017.
“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,” Kothari said in a statement.
“As I move on to my next opportunity, I am glad to leave behind a strong foundation.”
Dhruv Agarwala, the PropTiger CEO and Co-founder, will be CEO of the new entity — which has yet to be named and was referred to as the ‘PropTiger-Housing.com’ combination in the announcement.
“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,” said Agarwala.
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PropTiger has completed US$1.5 billion worth of transactions since its launch in 2011 and Housing receives 4 million visits per month.
In Q3 2016, PropTiger went on a small spending spree, buying 3DPhy in August and aqui-hiring PropRates in September.
Of note: REA Group acquired Malaysia’s iProperty in February 2016.
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