News Corp. said Tuesday it has signed a deal to buy Move for about $950 million in cash, as the newspaper publisher looks to become a new competitor in the online real-estate market.
Move, based in San Jose, Calif., offers listings of sales and rental properties in the US, reaching about 35 million people per month on its sites, including Move.com. Move also owns ListHub, a digital platform that aggregates and syndicates multiple listing-services' data to more than 130 online publishers and reaching about 900 websites.
Move's shares surged about 37 percent to nearly $21 a share, just under the offer price.
The acquisition comes two months after online real-estate listing giantfor $3.5 billion and makes plain News Corp.'s ambitions in this niche. Both companies capture bigger audiences than Move, with Zillow in July reporting 83 million unique users and Trulia reporting 54 million.
Move will "contribute to the transformation of our company, making online real estate a powerful pillar of our portfolio," News Corp. Chief Executive Robert Thomson said. "We intend to use our media platforms and compelling content to turbo-charge traffic growth and create the most successful real estate website in the US."
News Corp. already has some expertise in the real estate world. The company owns 62 percent of REA Group, the operator of Australian residential property website Realestate.com.au. REA plans to hold a 20 percent stake in Move with 80 percent held by News Corp.
The Move deal is among a string of acquisitions in the past year by News Corp., which is controlled by media mogul Rupert Murdoch and owns the Wall Street Journal and publications in the UK and Australia. The company has worked to diversify since it was spun off from 21st Century Fox last year and now needs to protect against a long-term, industrywide slide in newspaper advertising revenue. News Corp. in May agreed to purchase romance novel publisher Harlequin Enterprises for $415 million, and before that inked deals for British luxury-shopping website Handpicked Companies and social-media tools company Storyful.
A handful of news and entertainment companies in recent years have opted to spin off their slower-growth print operations as more readers and advertising dollars move online, with the new companies left to find ways to survive in the digital age. Time Warner spun off magazine publisher Time, Tribune broke up its broadcasting and publishing assets, and Gannett last month opted to spin off its publishing business from its broadcasting and digital operations.
After News Corp. was separated from movie and television giant 21st Century Fox, it was left with about $2.6 billion in cash, which it has used to help with its acquisitions.
While the newly created publishing companies work to reinvigorate their growth, industry watchers expect a new round of consolidation among these firms as they try to save money.