CoreLogic Shuns Higher CoStar Bid, Sells To Private Equity Firms For $6B
Residential real estate data specialist CoreLogic has inked a deal to sell itself to private equity firms Stone Point Capital and Insight Partners for $80 a share, or about $6B, leaving about $700M on the table compared to a bid from CoStar Group.
Stone Point Capital and Insight Partners' per-share price is slightly below what CoreLogic was trading for at the end of Thursday ($81.82) but higher than at any time in the last 12 months.
CoStar was willing to pay about $86 a share in an all-stock bid, according to Bloomberg, which would make the deal worth $6.7B. It isn't clear why CoreLogic rebuffed the higher offer. Neither CoreLogic nor CoStar responded to queries from Bisnow on the matter.
The bidding for Irvine, California-based CoreLogic had been in the works for a number of months. Private equity firm Warburg Pincus also made an all-cash bid for CoreLogic, though its total wasn't released.
Last summer, activist investors Cannae Holdings and Senator Investment Group offered $65 per share for the company but tabled their bid as other interested buyers with higher bids emerged. The investors also won three seats on CoreLogic's board of directors in 2020.
"The transaction is the culmination of our board’s extensive review of strategic alternatives, which included engaging with numerous potential buyers," CoreLogic Chairman Paul Folino said in a statement.
CoreLogic's decision represents the second major potential acquisition CoStar has lost out on. In November, the Federal Trade Commission authorized a lawsuit to prevent CoStar from acquiring RentPath, alleging that the deal would further concentrate online listings for large apartment complexes.
CoStar has been able to finalize a string of other acquisitions in recent years, including a deal for Off Campus Partners in 2019, the $450M purchase of STR in 2019 and the $190M acquisition in May 2020 of digital auction platform Ten-X. In December, the FTC cleared the company's acquisition of Homesnap.
Stone Point Capital and Insight Partners manage the funds that will provide the equity financing in the CoreLogic deal, and J.P. Morgan Securities will provide debt financing. The deal is expected to close in Q2 2021.
