Zillow Makes $50M Acquisition Move on StreetEasy, Plans Stock Offer
[Updated 8/19/13 7:00 pm. See below.] On Monday, Seattle-based real estate marketplace Zillow (NASDAQ: Z) announced it inked a $50 million cash deal to acquire residential real estate website StreetEasy, based in New York.
Also this morning, Zillow revealed plans for a public offering of 2.5 million shares of its Class A common stock, along with more than 2.5 million additional shares to be sold by some of its existing shareholders. [Pricing added.] The company priced the stock offering at $82 per share and said the net proceeds it hopes to reap would go towards the acquisition of technology and businesses (which likely includes StreetEasy) as well as for working capital needs.
Founded in 2005, StreetEasy lists residential properties for sale and rent in New York, Philadelphia, and Washington, DC, and areas such as Northern New Jersey, South Florida, and The Hamptons. A spokesperson for Zillow said via e-mail that as of now the StreetEasy brand is expected to continue to operate after the acquisition closes, which is anticipated to happen within a few weeks.
This is the latest move in the increasingly competitive online real estate market, which has seen prior acquisitions by Zillow and rival deals by Trulia in San Francisco reshape the battle lines of this sector. Zillow said in a blog post that today’s deal would deepen its presence in the New York market while providing StreetEasy access to more resources for customer growth and product development.