Makes ‘Move’ On Rival

Internet real estate company announced Friday that it will acquire Cendant Corporation’s Internet real estate portal in an all-stock deal valued at $761 million (US$).

When the deal is finalized, and its related assets — including rental listing and apartment finder service — will be integrated into the network, which currently includes,, and

“With this transaction, we’re increasing choices for consumers nationwide while continuing to put the real estate professional center stage,” said Stuart Wolff,’s chairman and chief executive officer.

Numbers released in September by The NPD Group and Media Metrix showed that was the most popular online real estate site in July, with almost 2.5 million unique visitors. Tied for second place were and MSN’s, with 1.5 million unique visitors each.

Inside the Deal

Under the terms of the agreement, which is expected to be finalized within six months, will acquire in an all-stock deal totaling approximately 26.3 million shares of the company’s common stock. The deal is worth $761 million based on Thursday’s closing price of $28.953 per share. said it expects the acquisition to be accreted to the company’s fiscal 2001 earnings. When the deal is closed, Cendant Corporation will be entitled to name one director to’s board.

The acquisition is subject to the approval of’s shareholders and regulatory review. According to the companies, the transaction is already under review by the antitrust division of the U.S. Department of Justice.

The transaction does not include National Home Connections or Metro Rent, which will be retained by Cendant. However, will acquire Cendant’s Welcome Wagon, the direct marketing program that provides new homeowners with information about area retailers.

Restrictions Imposed

The terms of the deal restrict Cendant’s ability to sell its shares. Cendant has also agreed to a ten-year standstill which, under most conditions, prohibits the company from acquiring additional common shares.

In all corporate matters, Cendant will vote its shares in proportion to the voting decisions of all other shareholders.

Cendant will also become an equity investor in’s technology project to develop an online real estate transaction platform. Other project partners include the National Association of Realtors (NAR), Fannie Mae, GMAC Real Estate, GMAC Mortgage and VeriSign.

NAR Deal Not Affected

The transaction will give the exclusive rights for 40 years to the aggregated online residential real estate listings of Cendant’s three national real estate franchises — Century 21, Coldwell Banker and ERA. Together the franchises are involved in approximately 25 percent of all U.S. residential real estate transactions.

The three franchises have also agreed to develop cross-marketing campaigns with and feature the URL in at least 50 percent of their offline advertising campaigns.

According to NAR President Dennis Cronk, the deal will not alter the NAR’s operating agreement with The NAR is a investor, and is the official Web site of the NAR.

Cronk said, “ will continue to be operated for the benefit of all Realtors without any bias or other advantage or preference over other real estate firms.”

Leave a Comment

Please sign in to post or reply to a comment. New users create a free account.

E-Commerce Times Channels