ZipRealty Inc. (NASDAQ:ZIPR) today announced that it has repurchased approximately 3.5 million shares of common stock directly from Pyramid Technology Ventures I, L.P. (“Pyramid”), which constitutes all of the shares of common stock held by Pyramid. Pyramid originally acquired the shares in private placement transactions or pursuant to warrants acquired prior to the Company’s initial public offering. The shares were purchased in a privately negotiated transaction for a purchase price of $5.00 per share for a total purchase price of approximately $17.4 million. Following this repurchase, there are approximately 20.2 million shares of common stock of the Company outstanding. ZipRealty now estimates that the weighted average basic and fully diluted shares outstanding for the year ending December 31, 2008 will be approximately 20.9 million shares.
As a direct result of this repurchase, the Company now expects to report a full year GAAP loss of between $0.42 and $0.50 per share and a pro forma loss of between $0.23 and $0.30 per share. The Company originally communicated a GAAP range of $0.35 to $0.41 loss per share and a pro forma range of $0.18 to $0.24 loss per share in its fourth quarter earnings release on March 13, 2008. The revised guidance is attributable to the reduction in interest income on the funds used to repurchase the Pyramid shares and the related decrease in weighted average shares outstanding for the full year. Revenue guidance for the full year remains unchanged and is expected to range from $114.0 to $118.0 million.
Pat Lashinsky, President and CEO of ZipRealty, Inc., stated, "We believe this transaction is in the best interests of our stockholders and, after the reduction in cash required by the repurchase, we will continue to have a strong balance sheet. Given our long-term confidence in our strategy and in our ability to execute, we expect this repurchase to be accretive beginning in 2009.”
About ZipRealty, Inc.
ZipRealty is a full-service residential real estate brokerage firm. The Company utilizes its user-friendly website and employee real estate agents to provide homebuyers and sellers with high-quality service and value. ZipRealty’s website provides users with access to comprehensive local Multiple Listing Services home listings data, as well as other relevant market and neighborhood information. The Company’s proprietary business management system and technology platform helps to reduce costs, allowing the Company to pass on significant savings to consumers. Founded in 1999, the company operates in 34 major markets in 19 states and the District of Columbia.
