General Atlantic preparing $3 billion offer for Idealista
An American fund is participating in a consortium with a Canadian fund to bid for Spain’s largest real estate portal, owned by EQT.
General Atlanticin consortium with a Canadian investment fund, is negotiating with the fund equipment for the possible acquisition of Idealista, the operation is coordinated by Morgan Stanley and this also aroused interest other venture capital managers such as TA Associates, CVC and Cinven, According to several market sources consulted by EXPANSIÓN.
General Atlantic, American giant with assets under management of 84 billion dollars, is not very well known in Spain, although it is one of refer to shareholders of companies such as Shein, ByteDance (TikTok) or Ant Financial.Pablo Isla Work senior advisor firm after his departure from Inditex before his joining Cinven and, in addition, In the past he had stakes in Santander AM, Facebook, Alibaba, Uber, Slack or Snapchat.
According to sources consulted, A consortium led by General Atlantic, of which CPPIB may be a partner, is one of the most serious candidates. take control of the largest Spanish real estate portal, through which EQT and the remaining Idealista shareholders are asking for about $3 billion. Euro (company value). This price represents more than 20 times EBITDA, reflecting the company’s leading position in the European market and its strong growth headroom.
Other interested parties
Idealista’s potential buyers also include: TA Associates, CVC and Cinven, although some of these firms may have already ruled out the operation due to the price requested by their current owners. He’s already done it Silver Lakewhich also recently showed interest in the Spanish company.
The goal of EQT in the competitive process is select two or three candidates willing to pay the required amount before giving greater access to the company’s numbers and its management team. In essence, this is a procedure similar to that organized by Bridgepoint about it Dorna, where he transferred to the market the amount he hoped to receive from the transaction before discussing the details of a possible agreement.
IN Idealisticnevertheless, candidates with an industrial profile are not expected, since the company’s partners agreed to direct the deal in favor of venture capital funds. Sources at Idealist and other parties involved declined to comment on the matter.
Be that as it may, the operation is still in progress initial stage. No proposals have yet been submitted and various candidates have not yet completed the required work due diligence which is carried out private equity before submitting your proposals. However, it is possible that a consortium led by General Atlantic or some other candidate may present a super proposal that requires exclusivity. (preventative offer, in the jargon) to break the process, as he did recently MCG at the auction Prosur.
possibility of listing Idealista on the stock exchange with a public offering for sale (IPO) it seems discarded for nowand it will not be renewed unless the competitive purchase bids are extremely low, an extreme that is not present in the operation scenario.
In addition to EQT, they are minority shareholders in Idealista. Apax Partners (former portal management partner), Oakley Capital and various founders and directors. The funds are expected to sell their stakes in a potential transaction and the management team will retain the stake with the new owner, especially if it is a different investment fund.
Idealista, co-founder Jesus Encinar (who continues to serve as CEO), is active in the Spanish, Portuguese and Italian real estate markets through portals that bring together people interested in buying, selling or renting real estate.
Results
Current EBITDA is between 120 and 140 million. euro, which is significantly higher than the latest publicly available data corresponding to 2022. This year the Idealista group achieved EBITDA of 79 million euros on revenues of 218 million. Of course, after amortization of goodwill, a loss of 82 million was recorded.
The main business consists of conclusion of advertising packages from real estate professionals on the portals Idealista and YaEncontrealthough it has other services such as real estate credit broker, online booking development, home rental portal management. Rentalia and CRM (customer relationship management). The company just extended its debt maturities to 2029, which could facilitate its sale, which is expected to be signed in the second half of 2024.
EQT is preparing to leave the group after four years
For more than two decades, Idealista has managed to survive the dot-com crisis and various real estate cycles and has become one of the few companies to form an exclusive club of Spanish unicorns. Founded in 2000 and initially backed by Basque and Catalan savings banks, the company attracted fund interest early on in its existence.
Bonsai Venture joined the company in 2003, followed by international fund Tiger Global Management in 2007. Apax Partners took over the management of these funds, which burst onto the real estate scene in 2015 by buying stakes in Tiger Global Management, KutxaBank and Bonsai Venture, valuing the companies at €235 million.
Five years later, The Idealist rang. Swedish fund EQT took control of the group in September 2020 in a transaction that valued the company at more than $1.3 billion, and a few months later brought in Oakley (12%) and, again, Apax (17%) . EQT has more than 55%.
Oakley was the owner of Casa.it, an Italian property portal, until EQT acquired it and then handed it over to Idealista.