- Opendoor is the Social Capital Hedosophia Holdings Corp., SPAC, a “blank check” company headed by billionaire investor Chamath Palihapitiya. Public discussions are underway through the merger with II, Bloomberg reported on Thursday.
- Opendoor is a real estate technology company that buys homes directly from sellers, makes some improvements and then resells them.
- Although the deal is not yet complete and the deal may collapse, investors are nonetheless bidding for SPAC shares up to 7% on Friday trading, Bloomberg said.
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Social Capital is a “blank check” company or SPAC that has been looking for tech companies to acquire since it started trading in April. SPAC is led by billionaire investor Chamath Palihapitiya.
This is not Palihapitiya’s first rodeo in the SPAC world. His first entry was in 2019 when space exploration company Virgin Galactic went public through a merger with SPAC led by Palihapitiya.
Opendoor operates a business similar to Zillow’s relatively new home buying program. The San Francisco-based company buys homes directly from sellers, makes minor repairs to the homes, and then resells them for profit.
Some of the benefits to home sellers, according to the website, are lower home sales fees and greater flexibility for exit and deadlines.
In the latest funding round in 2019, Opendoor was worth $3.8 billion. According to Bloomberg, Opendoor is worth about $5 billion in transactions with Social Capital.
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A potential deal with Opendoor could be a good timing given your exposure to the housing industry. In recent months after the COVID-19 pandemic began, the housing industry boomed in order to escape to the suburbs after city residents ordered months to work from home.
The deal is expected to be announced in the coming weeks. Social Capital Hedosophia Holdings Corp. II’s stock surged 7% on Friday trading.
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