By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Tech stocks managed to erase much
of their losses by the time the market closed Monday, with online
real-estate information company Zillow Inc.'s $3.5 billion
acquisition of rival Trulia Inc. taking the spotlight among
Internet stocks and the overall tech sector.
Zillow (ZILLOW.XX), which had been in the red most of the day,
ended up rising almost 1%, to close at $160.32, while Trulia Inc.
(TRLA) climbed more than 15%, to $65.04 after the all-stock deal
that would bring together two of the biggest names in the
fast-growing market for online real-estate information was
announced. The deal is expected to close in 2015.
Zillow said it will continue to use the Trulia brand, and Trulia
Chief Executive Pete Flint will retain his title and report to
Zillow CEO Spencer Rascoff. Flint and a second member of Trulia's
board of directors will join Zillow's board.
While both companies are known mostly as real-estate resources
for consumers, Zillow said in a statement that they "are primarily
media companies, generating the majority of revenue through
advertising sales to real estate professionals." In June, Zillow
reported 83 million unique visitors across its mobile and Web
platforms, while Trulia reported 54 million unique visitors during
the month.
Mark Mahaney, of RBC Capital Markets, called the acquisition "a
natural consolidation with the online real estate industry," in
which advertising is valued at more than $10 billion annually.
In addition to Zillow and Trulia, mild gains also came from
Apple Inc. (AAPL), up 1.4% to close at $99.02; Priceline.com Inc.
(PCLN), which rose almost 1% to $1,239.29, as well as IBM Corp.
(IBM), Oracle Corp. (ORCL) and Netflix Inc. (NFLX).
The Nasdaq Composite Index (RIXF) ended the day down by 4.7
points and the Philadelphia Semiconductor Index (SOX) also closed
with a small loss.
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