Boston, MA 10/09/2014 (wallstreetpr) – IFM Investments Limited (NYSE:CTC) or Century 21 China Real Estate signed an agreement for strategic collaboration with SouFun Holdings Limited (NYSE:SFUN). The company associates with the leading real estate internet portal company to form a mutual relationship across their business lines.
Collaborative effort
Century 21 China intends to strengthen its place in the growing and highly-fragmented real estate market. The company already had a strong position in brokerage services, fund management and commercial services in real estate segment.
However, it needs appropriate advertising channels such as internet portals to widen the opportunities in the fast-growing real estate market. Therefore, Century 21 China makes a strategic partnership with SouFun to avail the listing services, advertising and e-commerce and also financing in internet for real estate and brokerage services.
According to the agreement, Century 21 China will issue new shares to SouFun through a private placement for its 20% of outstanding share capital. In addition, SouFun will grant a loan to Century 21 China’s founders through IFM Investments Limited (NYSE:CTC) Overseas Partners L.P. IFM will refinance a previously borrowed loan from GL Asia Mauritius II Cayman Ltd.
On the other end, Century 21 China will issue a convertible bond to support the operational needs of SouFun. So, SouFun Holdings Limited (NYSE:SFUN) will contribute a total of ~$51 million for the collaborative agreement and will become the second largest stakeholder (fully diluted basis) in Century 21 China.
In the end
Century 21 China’s Chairman and CEO, Donald Zhang said that the agreement with a leading real estate online player is a key milestone to support future growth in the business. It will offer a complete O2O experience for buyers and sellers using the well-established online platform of SouFun Holdings Limited (NYSE:SFUN).
Zhang also said that the collaboration will offer more integrated services to the customers. It will also support the company’s franchise model and expand the network across China.
