In a major consolidation of the Indian digital realty space, News Corp ( NWSA ) backed PropTiger.com and Softbank-backed Housing.com announced a merger to create India's largest online real estate service company. The combined company - yet to be named - will be led by the CEO of PropTiger. This joint entity is expected to raise $55 million in capital - $50 million from News Corp-owned Australia's REA Group Ltd and $5 million from an affiliate of SoftBank. Other financial terms of the deal have not been disclosed yet.
The Indian real estate market is expected to touch $180 billion by 2020. In fact, India could become the third largest real estate market in the world by 2030 and contribute over 15% of the country's GDP. The joint entity could help News Corp expand its presence in the growing real estate market in India, given PropTiger's content advantage along with Housing.com's skilled resources. Digital Real Estate is a separate business division of News Corp, contributing 10% of the company's revenues (FY 2016) and 50% of the segment Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA).
PropTiger.com & Housing.com
In November 2014, News Corp acquired a 25% stake in the parent company of PropTiger.com for $30 million. PropTiger is the largest online residential real estate brokerage firm in India, and has completed transactions worth $1.5 billion since its founding in 2011. News Corp's strategy to grow in the Indian retail market includes acquisitions of large and small players in the market, and PropTiger has been known for acquiring rivals. In 2015, PropTiger acquired online classifieds platform Makaan.Com to launch India's first Online-to-Offline (O2O) platform. In the same year, PropTiger also acquired a digital design startup, Oobi.
This merger could strengthen PropTiger's O2O services proposition as the joint entity will draw on strengths of PropTiger, Housing.Com and Makaan.Com to offer a unique experience to consumers, brokers and homeowners. The new entity will be the only player in India offering a full range of online and offline services in the real estate space such as personalized searches, virtual viewing, site visits, home loans and post-sales service.
Have more questions about News Corp? Please refer to our complete analysis for News Corp