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Silver Lake Agrees to Buy Property Portal ZPG for $3 Billion

Updated on
  • Shareholder Daily Mail & General Trust backs acquisition
  • ZPG best known for its Zoopla property data, listings website

Silver Lake Purchases Property Platform ZPG

Silver Lake agreed to buy property platform ZPG Plc for almost 2.2 billion pounds ($3 billion) as the U.S. private-equity investor seeks to grow further in U.K. real-estate data.

ZPG shareholders will receive 490 pence in cash per share, and Silver Lake already secured support for the bid from newspaper group Daily Mail & General Trust Plc, the property portal’s largest shareholder, the companies said in a statement Friday. In total, more than 30 percent of ZPG shareholders have agreed to back the deal.

Private-equity investors are buying analytics firms seeking to monetize data flows. ZPG owns and operates a number of online property portals, including Zoopla, and a range of real-estate data firms. Founded in 2007, the group has steadily been buying up property and price-comparison platforms. In September, ZPG bought financial services website Money.co.uk for an initial 80 million pounds, a few months after acquiring property data provider Hometrack for 120 million pounds.

Shares in ZPG jumped 30 percent to 488.2 pence at 9:24 a.m. in London, the biggest advance since the company listed in 2014. Despite the rocky U.K. housing market, the stock had risen 13 percent this year before Friday’s bid. Daily Mail jumped 4.7 percent to 744.50 pence.

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U.S. investor Silver Lake, with around $40 billion of assets under management, has already been targeting U.K. property groups. In March, it announced a deal with Battery Ventures to buy EDR, a real estate software company, from DMGT for $205 million. DMGT holds just under 30 percent of ZPG.

Industry analysts have recently flagged U.K. real estate agents as targets for M&A activity, with traditional high-street players like Foxtons Group Plc and Countrywide Plc facing a stagnant housing market and a loss of market share to online competitors.

The takeover by Silver Lake comes at a time when U.K. home prices plunged the most in almost eight years in April. Values dropped 3.1 percent from March to an average 220,962 pounds, mortgage lender Halifax said in a report Tuesday, the biggest drop since September 2010.

The sale is a windfall for DMGT, which runs British newspapers, events, and financial information services, representing 14 times the cost of the investment. Analysts at Barclays called it "a clear positive," as proceeds could clear the company’s forecast 259 million pounds of net debt for the fiscal year and leave it with 384 million pounds in net cash.

ZPG is being advised by Credit Suisse Group AG and Goldman Sachs Group Inc. Boutique Robey Warshaw and Connaught Group advised Silver Lake. Lazard Group LLC advised DMGT.

— With assistance by Thomas Seal

(Updates with share trading, context on sale and DMGT.)
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