Online marketplace operator Trade Me has been approached by British private equity player Apax Partners with a $2.54 billion takeover offer.
Apax is offering $6.4 for each share of Trade Me, representing a 25.5 per cent premium to the company’s last close of $5.1.
“The Board of Trade Me, together with its advisers, has reviewed the indicative proposal and has decided to engage with Apax,” a company statement read. “Trade Me has provided Apax with due diligence access on an exclusive basis until 12 December to facilitate a binding offer.
"This exclusive access is subject to a “fiduciary carve out” that permits Trade Me to engage with third parties should it receive any unsolicited proposals.”
According to a statement released via the New Zealand stock exchange (NZX), this indicative proposal is subject to a number of conditions, including the completion of due diligence.
With market development updates expected in due course, the board also added that there is “no certainty” the indicative proposal will result in an offer or any other transaction for Trade Me.
Headquartered in London, Apax is a private equity firm with presence across New York, Hong Kong, Mumbai, Tel Aviv, Munich and Shanghai.
According to the firm’s website, funds advised by Apax typically invest in large companies with an enterprise value between €1 billion and €5 billion, spanning sectors such as technology, telecommunications, services, healthcare and consumer.
Key technology investments include Sophos, Smart Technologies and ThoughtWorks, in addition to Epicor, Orange and Exact Software.
Launched in 1999 with around 15 staff, Trade Me now has over 600 employees and is the most popular online marketplace and classified advertising platform in New Zealand.
The website offers auctions and fixed-priced sales for cars, real estate and other household items, in addition to jobs and online dating services.
As reported by Reseller News, Trade Me CEO Jon Macdonald announced in June that he will step away from the business by the end of the year.
Furthermore, Trade Me had a more than two per cent rise in net profit for fiscal 2018 - it had also forecast a stronger performance in 2019.
(Additional reporting by Ambar Warrick in Bengaluru; editing by Andrew Roche and Dan Grebler - Reuters)