Seattle, WA, United States (4E) – Zillow (Nasdaq: Z) announced Monday the purchase of rival Trulia (NYSE: TRLA) for $3.5 billion to create the largest real estate listing websites in the U.S. in terms of number of unique visitors.
Zillow Chief Executive Spencer Rascoff said the merger is a big chance to grow the business as the two companies can increase their combined revenue to more than 4 percent of the $12 billion that real estate agents spend on online and offline advertising annually.
The companies will also save money on marketing costs and gain clout in their negotiations with MLS services and large real estate brokerage firms over listings.
Under the merger deal to be closed by next year, Zillow and Trulia will retain their names and websites, which together drew 137 million unique visitors in June. Trulia CEO Pete Flint retains his position and will report to Rascoff.
Trulia shareholders will receive 0.444 shares of Class A Common Stock of Zillow for every Trulia share they own allowing them to own about a third of the combined company, according to USA Today. The value of the deal is a 25 percent premium on Trulia’s Friday closing price of $56.35.
News of the merger caused Zillow shares to rise closing at $158.86 a share on Friday. Zillow shares are down more than 3 percent in early trading Monday to $153.74, while Trulia stock is up more than 13 percent to $63.99 a share.
Zillow ranks number one in the list of 15 most popular U.S. listings website as of July 2014, according to eBizMBA Rank. Trulia is at number 2 followed by Yahoo! Homes, Realtor.com, RedFin, Homes, FrontDoor, ApartmentGuide, Curbed, HotPads, ZipRealty, Apartments, Rent, Auction, and ForRent.
The 15 sites offer home listings search and mapping making them popular to both homebuyers and agents. But there are other listings websites challenging the top 15 sites such as Nestbuilder.com, which shows roughly 1.6 million videos of agents’ products and virtual tours.
The same videos and tours are created using tools available on the website itself like the MicroVideo app and Nestbuilder Agent. The tools were developed by real estate digital media and technology company RealBiz Media Group, Inc. (OTC: RBIZ).
By creating virtual tours of listings, RealBiz Media allows homebuyers to get an accurate representation of the property, saving them time and money instead of traveling to the location. Its virtual tours have resulted in 113,092 published listings.
More than 15,000 agents use Nestbuilder Agent and MVA video platforms to produce and publish more than 24,000 videos.