In a surprise move, Axel Springer, the sole owner of immonet.de the number 3 player in the German portal market, gave 11.3% of its equity to Madsack, another German media group, in exchange for a content distribution deal.
While the details of the deal are a little sketchy, it appears that in exchange for the equity, the listings of Immonet.de will be displayed on the online platforms of Madsack including the free ads site dhd24.com.
In theory this should expand Immonet's reach into the German states of Mecklenburg-West Pomerania, Saxony, Lower-Saxony and Schleswig-Holstein.
This is not the first deal like this. Back in November 1999 (yes - I can remember back that far), realestate.com.au in Australia entered a similar deal with ninemsn (the joint venture between Packer backed Channel 9 and Microsoft). Here is the text of the deal.
"In exchange for 10% equity (5,165,000 shares) in realestate.com.au and a distribution fee of $200,000 in the first year and $400,000 in the second year, ninemsn will offer realestate.com.au several million dollars worth of exclusive promotion and advertising and access to technology. This will be a new issue of shares."
In the German market, the deal might actually make sense for immonet. When looking at the Google Ad Planner numbers - Immobilienscout24.de has 7.4m unique users, Immowelt.de has 2.9m and Immonet.de has 2.1m. If it is going to make a dent in the lead of IS24 and catch up to Immowelt, it has to do something different.
The challenge now for Immonet management is to make sure that the value is not wasted. The shares have been issued and it is essential that these are converted into leads for advertisers and into great brand awareness for Immonet.