REA Group boost with Southeast Asia online giant PropertyGuru to list in US

Digital property company REA Group’s Asia operation has been bolstered by plans to list Singapore-based online real estate firm PropertyGuru in the United States.

Singapore-based PropertyGuru hosts more than 2.8 million monthly real estate listings and serves 37 million monthly property seekers across the five largest economies in Southeast Asia. Picture: AFP

Digital property company REA Group’s Asia operation has been bolstered by plans to list Singapore-based online real estate firm PropertyGuru as a $US1.78bn ($2.4bn) enterprise in the United States.

The locally listed group, controlled by News Corp, in May struck a deal to combine its Malaysia and Thailand businesses with one-time rival PropertyGuru and take a stake in the enlarged Asian-based property platform.

REA emerged with an 18 per cent interest in PropertyGuru, which is the market leader in Southeast Asia and is strongest in Singapore, Vietnam and Malaysia, and Thailand where the two companies had been competitors.

The company will go public with the backing of Bridgetown 2 Holdings Ltd, a blank cheque company backed by Richard Li’s Pacific Century Group and private equity firm Thiel Capital.

The deal gives PropertyGuru an enterprise value of about $US1.35bn and an equity value of about $U$1.78bn. The transaction includes a fully committed $US100m private placement backed by Baillie Gifford, Naya, REA Group, Akaris Global Partners, and one of Malaysia’s largest asset managers.

REA also committed to an additional $US32m investment but declined to comment on Sunday.

PropertyGuru’s shareholders, including KKR, TPG Capital and REA, will retain over 70 per cent ownership of the listed company

The combined company is expected to begin trading on the New York Stock Exchange once the transaction closes.

PropertyGuru hosts more than 2.8 million monthly real estate listings and serves 37 million monthly property seekers and 49,000 active property agents across the five largest economies in Southeast Asia.

The digital property marketplaces match buyers and tenants with sellers and landlords and provide digital marketing services for property agents and developers. The company also has a proptech unit.

PropertyGuru’s high growth business delivered an average annual revenue growth of about 25 per cent in the four years preceding the COVID-19 pandemic, and its pro-forma revenue is expected to have a compounded annual growth rate of 29 per cent over the next five years.

Southeast Asia is estimated to become the fourth largest economy in the world by 2030, driven by long-term macroeconomic trends, including urbanisation, a rising middle class and digitalisation, all of which are creating opportunities in the region’s property market.

PropertyGuru has positioned itself through a series of acquisitions, including buying REA’s Malaysia and Thailand assets.

PropertyGuru Group chief executive Hari V. Krishnan flagged the company would expand. “We believe the strategic, proactive steps that we have taken over the past 18 months will enable us to stay ahead of the market’s evolving needs, which are increasingly being shaped by the growth of affluent and digitally-enabled populations living in cities across Southeast Asia,” he said.

Matt Danzeisen, chairman of Bridgetown 2, said that the company was a “category leader and category creator”.

“We believe PropertyGuru is just scratching the surface of what it can deliver as Southeast Asia’s property market continues to accelerate,” he said.