PROPERTY listings platform 99.co has inked a binding deal to take over the Singapore and Indonesia operations of ASX-listed REA Group via a joint venture (JV), of which the startup and its investors will own a 73 per cent stake.
99.co's move to grow inorganically comes just a day after rival PropertyGuru lodged its prospectus for a listing on the ASX.
Under the deal, 99.co plans to inject its business into the JV, which will also absorb two of REA's property listings portals, namely Rumah123.com in Indonesia and iProperty.com.sg in Singapore. The JV will be led by 99.co chief executive Darius Cheung.
REA disclosed in a bourse filing on Tuesday that it will contribute US$8 million in working capital to the JV. REA will be the single-largest shareholder with a 27 per cent stake. Its chief strategy officer Henry Ruiz and chief financial officer Janelle Hopkins will join the JV as non-executive board directors.
The remaining 73 per cent of the JV will be owned by 99.co and its investors, including Facebook co-founder Eduardo Saverin, Allianz X, MindWorks Ventures, East Ventures and 500 Startups.
REA expects the deal to be completed in Q2 FY2020 ended December. The JV company will be fully operational in Singapore and Indonesia in early-2020.
The transaction will boost 99.co's market share, Mr Cheung said in a press statement. "Our innovative DNA plus REA's unrivalled experience and resources makes this partnership a lethal combination South-east Asia has not seen before," he said.
REA Group chief executive Owen Wilson said: "Joining forces with 99.co creates the market-leading presence in terms of customers and listings. Combined with our expertise and experience in other countries where we are the clear market leader, this presents a fantastic opportunity to rapidly increase our market share in these expanding growth markets."