Online residential real estate platform Opendoor is listing shares publicly through a reverse merger that values the company at $4.8 billion.
In a statement, Opendoor said it entered into a definitive business combination agreement with Social Capital Hedosophia Holdings II, a publicly traded special purpose acquisition company (SPAC).
Opendoor said the deal will result in $1 billion in cash proceeds, including a $600 million fully committed public investment in private equity (PIPE) and $414 million in a trust account held by the special purpose vehicle.
Opendoor offers an on-demand, digital experience to buy and sell a home. Since its founding, the company has had 80,000 customers and sold over $10 billion of homes. Last year, the company sold more than 18,000 homes, generating $4.7 billion in revenue.
“This is one of many milestones towards our mission and will help us accelerate the path towards building the digital one-stop-shop to move,” Opendoor chief executive officer Eric Wu said.
Following the deal, Wu will remain with the company as CEO. Adam Bain, a director at SCH, will join the board of directors of the merged company.
Opendoor announced it was laying off 600 employees, 35% of its workforce, in April. The company said the COVID-19 crisis, “had an unforeseen impact on public health, the U.S. economy, and housing,” and it had “seen declines in the number of people buying, selling, and moving during this time of uncertainty.”
In April, investor Chamath Palihapitiya announced he had raised $720 million for the blank-check company, 20% more than its original target. Last fall, his first SPAC merged with Richard Branson’s Virgin Galactic in a deal that valued that company at $2.3 billion.
A report from the National Association of Realtors said sales of existing homes increased 25% from June to July, the biggest monthly jump in the history of the survey.