Breaking Finance News

News Corp Secures Deal to Buy Move Inc. for $950 Million

news-corpNews Corp (NASDAQ:NWSA), which owns both Down Jones Newswires and The Wall Street Journal, has agreed to purchase online real estate business, Move, Inc. (NASDAQ:MOVE) for $950 million. The all-cash agreement will help expand the media company’s presence in the United States real estate market. News Group anticipates having the acquisition complete by the end of 2014.

As part of the agreement, News Corp will make a tender offer of $21 per share within the next 10 days. The agreement was approved by Move’s board of directors and represents a 37% premium in Move’s closing stock price on Monday. According to News Corp, Move operates real estate listings for Move.com and Realtor.com and in 2013, reported $227 million in revenue.

News Corp has a 61.6% stake in the REA Group Limited (ASX:REA), which operates realestate.com.au specific to residential property in Australia. In 2012, The Wall Street Journal launched a feature and residential real estate section of “Mansion”.

Based on News Corp’s presence in real estate, the deal with Move is expected to expand business. As part of the agreement, the REA Group will take a 20% stake in Move for an approximate $200 million while News Group will hold the other 80%.

As stated by Robert Thomson, Chief Executive of News Corp in an email sent to employees, once the deal is finalized, News Group will be one of the United States and international digital property market players, in a market prepared for sizeable growth. Of all New Group acquisitions, the deal with Move is the largest.

Last June, Move Inc. split from an entertainment company that ultimately became 21st Century Fox, Inc. (FOXA). The digital real estate division of News Group accounted for roughly 5% of revenue for year-ending that same June. Move was established in 1993 and has 913 employees, all whom will stay at the current San Jose, California location.

Of trafficked real estate website networks, Move ranks third, following Zillow, Inc. (NASDAQ: Z) and Trulia Inc. (NYSE: TRLA), two companies that are planning to merge. Aggregate for sale home listing information from real estate websites comes from hundreds of different resources to include multiple listing services (MLS) and brokerages.

Although in third place, Move claims to have listings that are more accurate and up-to-date than its competitors due to its close partnership with the National Association of Realtors. However, according to representatives from Zillow and Trulia, the merge will make them the number one trafficked real estate website as far as online listings.

Just a few weeks ago, Zillow and Trulia revealed that the Federal Trade Commission (FTC) made a second request to get information about the proposed merger, which according to analysts, could trigger a detailed examination that could possibly take months to complete.

Zillow and Trulia stress that the merger is not intended to displace agents who purchase advertising on the sites. However, the new partnership makes some real estate agents wary that combined, the websites might try to increase pricing for advertisement.

Receive News & Ratings Via Email - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings with MarketBeat.com's FREE daily email newsletter.