To recover from a year of turmoil and the poor standing in the online real estate marketplace, the Mumbai-based company, housing.com, is looking for backers for strategic stake sale.
The company is in talks with the Snapdeal and News Corp, backer of the competitor PropTiger, for the strategic move. These discussions which are in budding stage will soon become a deal in 2016, second quarter. The final outline will depend on the company’s ability to display growth in its online property buy and sell business.
One of the sources, aware about the negotiations, confronted by the SoftBank, said that the deal will come down to the best price. SoftBank is the largest investor when it comes to online real estate market.
The Housing company observed a fall soon after the SoftBank’s investment round of Rs. 540 crore ($90 million) in November 2014, where it valued the company at around Rs. 1500 crore. Rahul Yadav, the company’s co-founder, engaged in public rows with the media, a prominent venture capital investor, and also the board of its company. This led to his dismissal from the company. Following which the company dropped business lines, overhauled its higher management, and downsized hundreds of employees. The attempt to strike deal with Quickr, an online classified portal also failed to materialise due to disagreement over the terms. The troubles swell at the time when the investors like Tiger Global and Softbank are asking the start-ups to boost revenues and deliver profits before asking for more cash.
In November, Housing said it would shut all the business units that include commercial and rental listings as well. This will allow the company to concentrate on its business of buying and selling homes. According to the industry experts this move was made with an aim to align the company with the Snapdeal’s ecommerce platform.