Property technology startup Opendoor is in advanced discussions with billionaire Chamath Palihapitiya's blank-check company to go public in a deal that could be valued at near $5 billion, Bloomberg reported Thursday.
What Happened: Social Capital Hedosophia Holdings Corp. II (NYSE:IPOB) is in talks with investors to raise fresh equity to fund the merger with Opendoor, people familiar with the matter told Bloomberg.
The deal could reportedly be announced in the coming weeks.
Opendoor buys homes online and sells them after making minor improvements. The company was valued at $3.8 billion as of its March 2019 fundraising round, according to Bloomberg.
Notable investors in the Eric Wu-led company include Softbank Group Corp’s (OTC:SFTBY) Vision Fund, General Atlantic, and Khosla Ventures.
Why It Matters: Palihapitiya and veteran investor Ian Osborne partnered to form Social Capital II, which began trading in April, Bloomberg noted. The company’s shares have risen 15.7% this month.
Blank-check companies or special purpose acquisition companies are in the limelight as 91 such companies have raised nearly $36 billion so far this year, as per data from SPACInsider.
Price Action: Social Capital shares traded nearly 16.4% higher at $14.45 in the after-hours session on Thursday.