New Delhi, Oct 29 (IANS): REA Group Ltd has entered into a binding agreement to acquire a controlling stake in Elara Technologies Pte Ltd, the owner of Housing.com, PropTiger.com and Makaan.com, in a deal that includes cash and newly issued REA shares.
Currently REA holds 13.5 per cent stake in Elara and post the completion of the transaction, its shareholding is likely to stand around 47.2 per cent 61.1 per cent.
The total consideration for the transaction is expected to be in the range $50 million to $70 million, with $34 million payable out of the existing cash reserves and the balance in newly issued REA shares.
The transaction is expected to close in the current quarter, subject to confirmatory due diligence.
REA Group CEO, Owen Wilson commented: "India is an incredibly attractive market and one that provides excellent long-term growth opportunities, while complementing REA's footprint in Australia, Asia and North America. The country is forecast to deliver strong growth over the next decade as it continues to experience rapid digital transformation."
"We plan to make significant investments in Elara going forward. With over 700 million internet users and roughly half a billion yet to come online, our increased investment in Elara will allow REA to be at the forefront of the considerable long-term opportunities within India, and the digitisation of the real estate sector," he added.
Elara will continue to operate as a standalone entity within the REA Group structure. Dhruv Agarwala, Co-Founder and CEO, along with the current leadership team of Elara, will continue to lead the company.
"With access to capital and expertise from REA we will continue to launch new products in the market to enhance the consumer experience and make the process of home buying, selling and renting simpler, more digital and more transparent," said Agarwala.
REA Group along with News Corp, already owns a significant minority stake in the company. The company has raised equity capital of $105 million to date from News Corp, REA Group, Elevation Capital, Softbank and Accel, among others.
Elara offers a range of residential property services across digital advertising and transactions including personalised search, virtual viewing, site visits, home loans and post-sales services. The company began with PropTiger.com and since then it has grown significantly both organically and inorganically with the acquisition of Housing.com and Makaan.com.
REA Group is a multinational digital advertising business specialising in the property segment and operates residential and commercial websites in Australia, along with platforms in Asia and the US.