Analysis & Comment

New Zealand's e-commerce leader gets $1.7 billion buyout offer, shares skyrocket

(Reuters) – New Zealand’s online marketplace pioneer Trade Me Group (TME.NZ) received a NZ$2.54 billion ($1.73 billion) takeover bid from a British private equity firm on Wednesday, sending its shares soaring.

London-based private equity group Apax Partners was offering NZ$6.4 for each share of Trade Me, the company said in a statement on the New Zealand stock exchange. The offer represents a 25.5 percent premium to Trade Me’s last close of NZ$5.1.

Trade Me and its advisors reviewed the proposal and has decided to engage with Apax, it said in the statement. Goldman Sachs (GS.N) is advising the e-commerce firm on the deal.

Trade Me shares jumped nearly 19 percent at the open to a record high of NZ$6.06 in a slightly weaker market .NZ50. The stock posted its biggest intraday percentage gain to date. It has risen about 10 percent this year, as of the last close.

“This would be a record price they (Apax) will pay if they go ahead with this deal,” said Grant Williamson, director of investment advisory firm Hamilton Hindin Greene.

“Trade Me has the bulk of the market share in New Zealand and obviously Apax views the company as having enough cash flow going forward.”

Apax’ offer is higher than where the company’s shares have ever traded, he said.

Trade Me said it had provided Apax with due diligence access on an exclusive basis until Dec. 12 to facilitate a binding offer.


Launched in 1999 with around 15 staff, the company 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. It also has jobs and online dating services.

The company’s CEO Jon Macdonald announced in June that he will step away from the business by the end of the year.

Trade Me had a more than 2 percent rise in net profit for fiscal 2018. It had also forecast a stronger performance in 2019.

London-based Apax Partners has investments in sectors such as technology, telecommunication and healthcare.

($1 = 1.4723 New Zealand dollars)

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