Trade Me receives $2.5b takeover offer from British company

Long Lunch 21/11/2018
Photo: File.

A multi-billion dollar takeover offer has been made for New Zealand auction site, Trade Me.

Apax Partners made the offer to acquire 100 percent of the company's shares at a cash price of NZ$6.40 per share. The offer would value Trade Me at $2.5 billion.

Trade Me announced on Wednesday it would engage with Apax and provide the company with due diligence access exclusively until December 12 to facilitate a binding offer.

However, Trade Me can engage with third parties if it receives any other unsolicited proposals.

Apax Partners is a British private equity firm, which Newshub Nation presenter Simon Shepherd explained as a group of investors with private funds that buy businesses looking for a short term profit.

Apax has investments in 107 companies ranging from online fashion brands to discount petrol stations to waste management.

The latest report into Trade Me revealed it made $250 million in revenue in the last financial year, up 6.6 percent from the previous year. The company's profit of $97 million was also up by 3.9 percent.

Trade Me said it is being advised by investment banking group Goldman Sachs.

The online-auction site was purchased by Fairfax Holdings in 2006 for $700 million, after being founded by Sam Morgan in 1999. Fairfax later sold its stake in 2012.

Listen to the full interview with Simon Shepherd above.

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