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You are at:»»Trulia Inc (NYSE:TRLA) Hits Record High, Up 11% on $3.5 Bln All-Stock Acquisition by Zillow Inc (NASDAQ:Z)
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Trulia Inc (NYSE:TRLA) Hits Record High, Up 11% on $3.5 Bln All-Stock Acquisition by Zillow Inc (NASDAQ:Z)

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Trulia Inc (NYSE:TRLA) shares jumped after the online provider of real-estate information agreed to be bought by larger rival Zillow Inc (NASDAQ:Z) for $3.5 billion in a stock-for-stock transaction.

Under the terms of the deal, Trulia shareholders would receive 0.444 share of Class A Common Stock of Zillow, for each share of Trulia, valuing TRLA at $70.53 per share as of Friday’s close. That is a premium of 25% to TRLA’s Friday closing price of $56.35.

TRLA is recently up 11.9% at $63.13 in midday Monday trading after hitting an all-time intraday high of $64 after the opening. Heavy volume of 8.7 million shares is more than four times average daily volume. Following a trading halt, Z resumed trading and is recently down 2.9% at $154.78 on 4.2 million shares, double average daily volume.

The combined company would maintain both the Zillow and Trulia consumer brands. The companies said they have limited consumer overlap, with approximately half of Trulia.com’s monthly visitors not visiting Zillow.com, and approximately two-thirds of Zillow.com’s monthly visitors across all devices not using Trulia.com.

At closing, Trulia CEO Pete Flint would remain as CEO of Trulia, reporting to Zillow CEO Spencer Rascoff, and would join the combined company’s board. Also at closing, a second member of Trulia’s board would join the board of the combined company. The deal is expected to close in 2015.

The companies said “significant opportunities of scale remain as the majority of advertising dollars in the real-estate sector have yet to migrate online or to mobile.” They noted their combined revenue represents less than 4% of the estimated $12 billion real-estate professionals spend on marketing their services to consumers each year. The companies generate the majority of their revenue through advertising sales to real-estate professionals.

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