News Corp, the publishing company controlled by Rupert Murdoch, agreed on Tuesday to buy Move Inc, an operator of real-estate listings Web sites, for US$950 million in cash, as the newspaper publisher continues to branch out into new businesses.
The transaction is the latest, and largest, by Murdoch’s publishing arm since it split from 21st Century Fox last year.
Under the terms of Tuesday’s deal, News Corp will pay US$21 a share through a tender offer for Move’s stock.
Facing steep declines in advertising and subscription revenue, News Corp is trying to stretch beyond newspapers like the Wall Street Journal.
News Corp paid US$415 million this year to take control of Harlequin Enterprises, the publisher of romance novels, to add to its HarperCollins publishing division. The company also paid US$25 million last year for Storyful, a social and video news agency.
“This acquisition will accelerate News Corp’s digital and global expansion and contribute to the transformation of our company, making online real estate a powerful pillar of our portfolio,” News Corp chief executive Robert Thomson said in a statement. “We intend to use our media platforms and compelling content to turbocharge traffic growth and create the most successful real estate website in the US.”
Total revenue at News Corp declined 4 percent to US$8.57 billion in the year that ended June 30, compared with the previous year.
Revenue in the news and information group, its largest business unit — which includes the Wall Street Journal and the Sun in Britain — dropped 9 percent, to US$6.15 billion, compared with the period a year earlier.
Long a pillar of the traditional newspaper industry, real-estate print ads have eroded with the emergence of new digital outlets.
Global ad spending on newspapers is expected to fall 2.9 percent this year to US$73.5 billion, the seventh straight year of declines, according to WPP’s GroupM.
In contrast, spending on the online real-estate market is steadily increasing.
The Move deal is expected to jump-start News Corp’s current real-estate services business, which delivered US$408 million in revenues to the company in the year that ended in June, up 18 percent from the previous year.
Move will bring a slew of real-estate listings, both properties up for sale and for rent.
Last year, the company reported US$600,000 in profit atop US$227 million in revenue.
Upon the closing of the deal, which is expected by the end of the year, News Corp will own about 80 percent of Move, while an Australian affiliate, REA Group, will own 20 percent.
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