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NEW YORK (AP) - Real estate website operator Zillow is buying competitor Trulia in a $3.5 billion all-stock deal.

Trulia's stock rose more than 16 percent in Monday premarket trading, while Zillow's stock fell more than 3 percent.

Trulia shareholders will receive 0.444 shares of Zillow common stock for each share they hold, and will own approximately 33 percent of the combined company. Zillow shareholders will receive one comparable share of the combined company and own the other two-thirds of the business.

Trulia Inc. CEO Pete Flint will stay in his post and remain on the board. Another Trulia director will join the combined company's board after the transaction is complete.

Both companies' boards approved the deal. Both companies' shareholders still must approve it. The transaction is targeted to close next year.

(Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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