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Melbourne based real estate advertising company REA Group Ltd has entered into a binding agreement to acquire a controlling interest in Elara Technologies Pte. Ltd. owner of Housing.com, PropTiger.com and Makaan.com.
The deal includes cash and newly issued REA shares. The transaction is expected to close in the current quarter, subject to confirmatory due diligence.
While the financial details of the deal were not disclosed, reports in Australian media suggest that REA Group will get five out of nine board seats and is expected to have a shareholding between 47.2 per cent and 61.1 per cent for $71-99 million. REA currently owns about 14 per cent stake in Elara.
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 stand-alone entity within the REA Group structure. Dhruv Agarwala, co-founder and CEO, along with the current leadership team, 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.
The digital real estate classifieds advertising market is expected to grow at a CAGR of 29 per cent until 2025, which provides the opportunity to build a big and profitable business, said a press statement from Elara.
Elara offers a full 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.
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