Even if antitrust regulators don’t stand in the way of a merger of real estate search giants Zillow and Trulia, they might impose conditions that would give Zillow cold feet about closing the deal, DealBook reports.
Zillow and Trulia have minimized antitrust concerns, saying that while they are big players in search, they are one of many players in the online media industry, and that most real estate ad dollars haven’t even migrated to online.
But DealBook’s ‘s Steven Davidoff Solomon notes that if government regulators place “restrictions of any kind on Zillow ‘or’ a material adverse effect occurs, Zillow does not have to acquire Trulia.”
(When CoreLogic acquired DataQuick Information Systems Inc. this year, for example, it agreed to license national assessor and recorder bulk data to RealtyTrac to settle a complaint by the Federal Trade Commission that the $661 million acquisition was likely to result in less competition.)
If Zillow is facing something similar that it doesn’t like, it can pay $150 million and walk away from the deal after the Jan. 28, 2016, termination date.
“That is 18 months, an eternity in the technology sector,” Solomon notes. Source: dealbook.nytimes.com.