Exhibit 99.1 - Press Release
Friday October 27, 8:01 am Eastern Time
Press Release
SOURCE: Homestore.com, Inc.; Cendant Corporation
Homestore.com, Inc. Agrees to Acquire move.com
from Cendant Corporation, Significantly
Extending the Internet's Largest Home and Real
Estate Marketplace
Combines the Two Most Popular Home and Real Estate Web Sites Under the
Homestore.com(TM) Network
Unifies Six of the U.S. National Real Estate Franchises Behind
Homestore.com's Online Real Estate Transaction Platform
THOUSAND OAKS, Calif., and NEW YORK, Oct. 27 /PRNewswire/ -- Homestore.com,
Inc. (Nasdaq: HOMS -news) and Cendant Corporation (NYSE: CD - news) today
announced they have signed a definitive agreement for Homestore.com to
acquire Cendant's Internet real estate portal, move.com, extending the
largest and most comprehensive wired marketplace for home and real
estate-related products and services on the Internet. The combined entity
will offer unprecedented choice and selection for consumers and
professionals alike.
The transaction combines the Internet's two leading' Web sites in the home
and real estate category under the Homestore.com(TM) brand. Acquired assets
to be integrated into Homestore.com's industry-leading family of Web sites
include Cendant's move.com, apartment locator Rent Net, direct marketing
company Welcome Wagon(R), and other move.com Web sites. The transaction
also ensures that Homestore.com's Web site REALTOR.com(R) will have
exclusive 40-year access to the aggregated listings of Cendant
Corporation's CENTURY 21(R), COLDWELL BANKER(R) and ERA(R) national real
estate franchises and includes an agreement by Cendant to purchase
Homestore.com's(TM) technology and web-based marketing products and
vertical ASP solutions.
In addition, Cendant will invest in Homestore.com's development of the
Realtors(R) Electronic Transaction Platform (eRealtor.com(TM), the official
real estate transaction platform of the National Association of
Realtors(R)) helping to unite industry participation behind Homestore.com's
technology solution for online real estate transactions. The result is a
real estate marketplace for the New Economy offering consumers and industry
professionals a variety of technology choices as well as easy and direct
access to the timely information and advanced technological tools they need
to conduct business on the Web.
Under terms of a definitive agreement signed yesterday, Homestore.com, Inc.
will acquire move.com in an all-stock transaction totaling approximately
26.3 million shares of the company's common stock. Based on yesterday's
closing price of $28.953 per share, the transaction is valued at
approximately $761 million.
"We are committed to building the most vibrant and comprehensive online
home and real estate marketplace possible at Homestore.com for the benefit
of all of our consumers and professional customers," said Stuart Wolff,
Homestore.com's chairman and chief executive officer. "With this
transaction, we're increasing choices for consumers nationwide while
continuing to put the real estate professional center stage. This is a
giant step forward," Wolff said.
Cendant's chairman, president and chief executive officer, Henry R.
Silverman stated: "Homestore.com has done an outstanding job establishing
itself as the leading Internet real estate destination, and we are very
pleased to align our expanding New Economy efforts with them. The benefit
of this transaction is twofold: first, it provides the expertise of an
Internet industry leader to enhance our real estate brands' Web sites and
technology to benefit franchisees and consumers. Furthermore, it benefits
our shareholders based on their investment in move.com and demonstrates the
successful execution of Cendant Internet Group's strategy."
Chairman and CEO of Cendant's Real Estate Division, Richard A. Smith said:
"This business combination is expected to enhance Cendant's off-line real
estate businesses and franchise systems. Licensees and consumers will
clearly benefit from this transaction through compelling new e-commerce
services, as well as joint marketing and promotional opportunities."
"We are most excited about this latest acquisition because it forges
together the expertise, resources and talents of the largest real estate
franchises and creates, on one stage, a platform for real estate
professionals to provide consumers efficient services in today's complex
marketplace," said NAR President Dennis R. Cronk.
"This transaction in no way alters NAR's operating agreement with Homestore
regarding the Realtor.com site or our interest in Homestore.com.
Realtor.com will continue to be operated for the benefit of all Realtors
without any bias or other advantage or preference over other real estate
firms," Cronk said.
Homestore.com(TM) said it expects the acquisition, which brings with it new
revenue streams and cost synergies, to be accretive to the company's fiscal
2001 earnings. Longer term, the company anticipates a variety of
synergistic opportunities resulting from the merged assets, as well as
increasing financial benefits from the economies of scale the transaction
will make possible.
Homestore.com's acquisition of move.com is subject to a number of customary
conditions including, among other things, the approval of Homestore.com,
Inc.'s shareholders, and regulatory review under the Hart Scott Rodino
Antitrust Improvements Act. The transaction is currently under review by
the antitrust division of the Department of Justice. Upon closing, Cendant
Corporation will be entitled to name one director to Homestore.com's board,
which currently has six members. Cendant also will be restricted in its
ability to sell its Homestore.com shares and has agreed to vote its shares
on all corporate matters in proportion to the voting decisions of all other
shareholders. In addition, Cendant has agreed to a ten-year standstill
agreement that, under most conditions, prohibits the company from acquiring
additional Homestore.com common shares. Homestore.com and Cendant
Corporation said they expect to complete the transaction within the next
six months.
The transaction includes the following key elements:
Homestore.com will integrate move.com and its related assets including Rent
Net, a leading residential rental listing and apartment finder service on
the Internet, into the Homestore.com network, combining two of the most
popular and traffic-generating real estate destinations on the Web today.
The transaction does not include National Home Connections (NHC) or Metro
Rent, which will be retained by Cendant.
Additionally, for 40 years, Homestore.com will acquire the exclusive rights
to the aggregated online residential real estate listings of Cendant's
CENTURY 21(R), COLDWELL BANKER(R) and ERA(R) national real estate brokerage
franchises, which also will continue to be featured on those brands'
respective Internet sites. Cendant and Homestore.com, Inc. will also enter
into an agreement to develop Internet-based technology and tools that will
provide even greater choices for real estate brokers and agents. Cendant's
real estate franchisees are currently involved in approximately 25 percent
of U.S. residential real estate transactions and annually assist more than
1.5 million buyers and sellers of single family homes.
Cendant will become an equity investor in Homestore.com's(TM) technology
project to develop an online real estate transaction platform
(eRealtor.com(TM), the official real estate transaction platform of NAR),
joining current participants including the National Association of
Realtors(R), Fannie Mae, GMAC Real Estate, GMAC Mortgage and VeriSign.
Prudential Real Estate Network and RE/MAX also endorse the transaction
platform. With the participation of Cendant's three national franchise
organizations, Homestore.com will unify six of the largest U.S. national
residential real estate franchises behind Homestore.com's industry standard
for online real estate transactions. Cendant Mobility, Cendant's relocation
company and NRT Incorporated, Cendant's largest real estate franchisee,
also have agreed to use the transaction platform exclusively for a period
of three years. These two organizations accounted for more than 400,000
transactions last year. Homestore.com will also have the ability to host
the Internet sites of Cendant's three real estate brands.
Cendant's three national real estate franchises have committed to develop a
series of cross-marketing and advertising programs with Homestore.com's
family of Web sites (including REALTOR.com(R)), including an agreement to
include the REALTOR.com(R) URL in a minimum of 50 percent of the three
franchises' offline advertising campaigns.
Finally, Homestore.com will acquire all rights to Welcome Wagon(R), the
widely recognized direct marketing program that introduces participating
neighborhood retailers and their services to new homeowners. Homestore.com
plans to leverage the brand equity of the 72-year-old company to expand and
enrich Homestore.com's local retail e-commerce business strategies. Welcome
Wagon represents a network of more than 35,000 merchants and reaches 1.8
million new homeowners annually.
About Homestore.com, Inc.
Homestore.com, Inc. (Nasdaq: HOMS - news) is the leading network of sites
on the Internet for home and real estate-related information, products and
services. Homestore.com, Inc.'s family of Web sites includes the
Homestore.com(TM), Realtor.com(R), HomeBuilder.com(TM),
SpringStreet.com(TM) and HomeFair.com(TM) Web sites. Consumers can view
over 1.4 million new and existing homes for sale and find broker and agent
services on Realtor.com(R), the official Internet site of the National
Association of Realtors(R). Consumers searching for new homes can find more
than 130,000 models, new homes and built-to-suit plans on
HomeBuilder.com(TM), the official new homes site of the National
Association of Home Builders. Consumers interested in renting an apartment
will find listing information from more than 45,000 properties in more than
6,000 cities on SpringStreet.com(TM). Homestore.com's(TM) remodeling area
covers home improvement needs for both consumers and remodeling
professionals. Comprehensive moving and relocation information on the
Internet is available from HomeFair.com(TM). Other subsidiaries of
Homestore.com, Inc. include WyldFyre Technologies, the leading developer of
software used to access Multiple Listing Service data and property photos;
Top Producer Systems, North America's #1-selling provider of leads
management and marketing software for real estate professionals; and The
Hessel Group, the leading provider of technology-driven solutions and
services to the relocation industry. Homestore.com(TM) also has content
distribution relationships with America Online; Excite @Home, Netscape and
Go Network/Infoseek.
About move.com
Move.com is Cendant's relocation, real estate and home-related services
portal. It integrates and enhances the offline and on-line efforts of
Cendant's CENTURY 21(R), COLDWELL BANKER(R) and ERA(R) residential real
estate brands; its other Web sites including Rent Net, House Net, Senior
Housing Net, and Self Storage.Net; and Cendant's other real estate business
units including Cendant Mobility, Cendant Mortgage, National Home
Connections and Welcome Wagon. Move.com draws upon the capabilities and
existing infrastructure of Cendant's lines of business and other selected
partners to assist customers with virtually everything they need before,
during and after their move. Built upon the success of Rent Net's online
apartment guide business model, move.com has distribution agreements with
Internet market leaders, including Alta Vista, About.com, Yahoo, AOL,
Excite, and Ask Jeeves. Move.com is headquartered in San Francisco, CA.
About Cendant Corporation
Cendant Corporation is a global provider of real estate, travel and direct
marketing related consumer and business services. The Company's core
competencies include building franchise systems, providing outsourcing
solutions and direct marketing. As a franchiser, Cendant is among the
world's leading franchisers of real estate brokerage offices, hotels,
rental car agencies, and tax preparation services. The Company's real
estate-related operations also include Move.com Group, Cendant's
relocation, real estate and home-related services portal on the Internet.
As a provider of outsourcing solutions, Cendant is a major provider of
mortgage services to consumers, the global leader in employee relocation,
and the world's largest vacation exchange service. In direct marketing,
Cendant provides access to insurance, travel, shopping, auto, and other
services primarily to customers of its affinity partners. In addition,
Cendant Internet Group is pursuing a convergence strategy for the Company's
off-line and online businesses. Other business units include NCP, the UK's
largest private car park operator, and Wizcom, an information technology
services provider. Headquartered in New York, NY, the Company has
approximately 28,000 employees and operates in over 100 countries.
Statements about future results made in this release relating to Cendant
Corporation may constitute forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements are
based on current expectations and the current economic environment. Cendant
cautions that these statements are not guarantees of future performance.
They involve a number of risks and uncertainties that are difficult to
predict including the outcome of litigation. Actual results could differ
materially from those expressed or implied in the forward-looking
statements. Important assumptions and other important factors that could
cause actual results to differ materially from those in the forward-looking
statements are specified in Cendant's Form 10-Q for the quarter ended June
30, 2000.
This press release contains forward-looking statements relating to
Homestore.com that are subject to material risks and uncertainties. Actual
results may differ materially and reported results should not be considered
as an indicator of future performance. Risks and uncertainties that may
affect Homestore.com's future results include, but are not limited to, the
following; the fulfillment of conditions to complete the transaction,
including regulatory and Homestore.com stockholder approval; the costs
incurred to complete the transaction; the combined company's competitive
performance; potential difficulties or unexpected costs in integrating the
companies, their product and service offerings and infrastructure; the
ability of the combined company to achieve anticipated synergies and
operating efficiencies; whether the transaction will be accretive to the
company's earnings; the continued employment of the combined entity's
employees; potential difficulties in maintaining and enhancing continued
working relationships with strategic partners, customers, real estate
professionals and other constituencies in the real estate professional
community; the continued development of product and service offerings of
the combined company; Homestore.com's ability to maintain and manage
favorable agreements and relationships with the National Association of
Realtors, the National Association of Home Builders and Internet portals;
Homestore.com's ability to continue to obtain a large percentage of
available real estate property listings; Homestore.com's ability to obtain
such listings on an exclusive basis; Homestore.com's ability to manage
rapid growth, both internally and through acquisitions; changes in the real
estate markets; seasonality and other fluctuations in Homestore.com's
financial results, Homestore.com's ability to maintain high reliability for
its server-based web services;and uncertainty as to the timing and amount
of future Internet-related revenue and profits. For a detailed discussion
of the above, and other, cautionary statements, especially statements
relating to the transaction, please refer to the Homestore.com proxy
statement to be filed by Homestore.com as described below, as well as risks
and uncertainties described from time to time in Homestore.com's filings
with the Securities and Exchange Commission (SEC). In particular, see "Risk
Factors" in the final prospectus included in Homestore.com's registration
statement declared effective by the SEC on January 26, 2000 and also see
Homestore.com's Annual Report on Form 10-K for the year ended December 31,
1999. Homestore.com assumes no duty to update the information in this press
release if any forward-looking statement later turns out to be inaccurate.
In connection with this transaction, Homestore.com will be filing a proxy
statement with the Securities and Exchange Commission. SECURITY HOLDERS OF
HOMESTORE.COM ARE URGED TO READ THE PROXY STATEMENT WHEN IT BECOMES
AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION REGARDING THIS BUSINESS COMBINATION.
Investors and security holders may obtain a free copy of the proxy
statement when it becomes available at the SEC's website at www.sec.gov, as
well as from the Homestore.com contacts listed at the beginning of this
press release. Homestore.com and its executive officers and directors may
be deemed to be participants in the solicitation of proxies from
Homestore.com's stockholders with respect to the transactions contemplated
by the merger agreement described in this press release. Homestore.com's
executive officers and directors include: Michael A. Buckman, M. Jeffrey
Charney, John M. Giesecke, Jr., Catherine Kwong Giffen, David M.
Rosenblatt, Joe Shew, Peter B. Tafeen, Stuart H. Wolff, Ph.D., John Doerr,
Joe Hanauer, Richard Janssen, William Kelvie, and Ken Klein. Information
regarding the beneficial ownership of shares of the company's common stock
by such participants, and other interests of such executive officers and
directors, is included in Homestore.com's proxy statement for its 2000
annual meeting of stockholders filed with the Securities and Exchange
Commission on March 10, 2000. This document is available free of charge at
the SEC's web site at www.sec.gov, as well as from the Homestore.com
contacts listed at the beginning of this press release. Stockholders may
obtain additional information regarding the interests of such participants
by reading the proxy statement when it becomes available.
SOURCE: Homestore.com, Inc.; Cendant Corporation
