EQT Private Capital Asia agrees $1.1bn deal for PropertyGroup Guru; EQT buys Korean recycler, seeks $12.5bn fundraise
The deal is expected to close by the end of Q1 2025 with its shares to stop trading on the NYSE; majority shareholders TPG and KKR have approved the deal. EQT has also bought a Korean plastic recycler and...
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The deal is expected to close by the end of Q1 2025 with its shares to stop trading on the NYSE; majority shareholders TPG and KKR have approved the deal. EQT has also bought a Korean plastic recycler and is looking to raise $12.5bn for a fund.
August 19, 2024
Hong Kong-headquartered EQT Private Capital Asia has has reached an agreement to buy PropertyGuru Group (PropertyGuru), a leading property technology company in Southeast Asia (SEA), for $1.1 billion in cash.
Major shareholders of PropertyGuru are TPG (through TPG Asia VI SF and TPG Asia VI SPV, in its capacity as general partner of TPG Asia VI Digs), which owns around 26.5%, and KKR (through Epsilon Asia Holdings II) which owns around 29.6% of the firm. Both have entered into voting and support agreements with the company and EQT Private Capital Asia in support of the deal.
PropertyGuru’s board of directors, acting upon the recommendation of a special committee, unanimously approved the deal and recommends approval of the merger by PropertyGuru’s shareholders, according to an August 16 announcement.
The offer is equal to $6.70 per share and represents a 52% premium to PropertyGuru’s closing share price on May 21, 2024, the last unaffected trading day prior to media speculation regarding a potential transaction, and a 75% and 86% premium to the company’s 30-day and 90-day volume-weighted average share price, respectively, for the period ending May 21, 2024, the announcement said.
The transaction is expected to close in Q4 2024 or Q1 2025, subject to closing conditions, including approval by PropertyGuru’s shareholders and receipt of regulatory approvals.
Upon completion of the transaction, PropertyGuru’s shares will no longer trade on the New York Stock Exchange (NYSE), and PropertyGuru will become a private company. PropertyGuru’s headquarters will remain in Singapore.
Moelis & Company is a financial advisor to the special committee and Freshfields Bruckhaus Deringer acted as its legal counsel. Morgan Stanley Asia (Singapore) is the financial advisor to EQT Private Capital Asia, and Ropes & Gray is acting as legal advisor to EQT Private Capital Asia. JP Morgan Securities Asia Private is financial adviser to KKR and TPG, and Latham & Watkin is legal adviser to KKR and TPG.
PropoertyGuru has a plan to merge with affiliates of BPEA Private Equity Fund VIII after which the company will be acquired by EQT Private Capital Asia.
Growth potential
The firm was founded in 2007 by Steve Melhuish and Jani Rautiainen, and provides digital property marketplaces for property seekers, real estate agents, property developers, banks and valuers across Singapore, Malaysia, Vietnam and Thailand. PropertyGuru listed on NYSE in March 2022 and raised $254 million in a special purpose acquisition (SPAC) deal with Bridgetown 2 Holdings, which was backed by Richard Li and Peter Thiel.
Hari Krishnan, chief executive officer & managing director, PropertyGuru, said in a statement, “We are pleased to embark on this new chapter with EQT. This partnership follows years of transformative growth, supported by TPG and KKR, which has established us as SEA’s leading proptech platform."
Krishnan added: "As we continue to innovate and deliver value to our consumers, customers, and stakeholders across the region, EQT’s global expertise in building marketplaces and commitment to sustainable growth will further strengthen our vision to power communities to live, work, and thrive in tomorrow's cities."
Giving an indication of the firm's future as a private company, Janice Leow, partner in the EQT Private Capital Asia advisory team and head of EQT Private Capital SEA, said: “PropertyGuru has firmly established itself as the leading property marketplace platform in SEA, and we are deeply impressed by the strong foundation it has built over the past 17 years as well as with its talented team.”
Leow added: “We believe our offer provides shareholders with compelling value and certainty, while strategically positioning PropertyGuru to fully harness its long-term growth potential. With EQT's significant experience in the technology, online classifieds and marketplace sectors, we aim to further strengthen PropertyGuru's platform, driving enhanced innovation and deeper engagement with its consumers, customers and stakeholders.”
EQT fund buys Korean recycler; seeks $12.5bn raise
In anoher move at the Swedish investment firm, EQT Infrastructure VI has bought KJ Environment from Genesis Private Equity, for an undisclosed sum. The idea is to establish "a scaled and diversified end-to-end waste treatment scheme platform focused on plastic recycling and waste-to-energy in South Korea", according to a media release.
KJ Environment works across recyclable waste sorting, plastic recycling and waste-to-energy. It has sites in the Greater Seoul Metropolitan Area, serving catchment areas covering more than 50% of the country’s population and its GDP.
The acquisition is EQT’s second infrastructure investment in South Korea.
Sang Jun Suh, partner in the EQT infrastructure advisory team, commented in the release: “We look forward to applying EQT’s extensive experience investing in sustainable waste and recycling solutions across geographies, combined with our strong local footprint and industrial network, to help KJ Environment elevate into a true market leader in the waste treatment space."
The company adds to EQT’s global portfolio of companies which engage in waste-related business and builds on EQT’s track record of supporting infrastructure companies in Asia Pacific (Apac). Since 2020, EQT Infrastructure has invested €5 billion ($5.52 billion) of equity, including co-investment, in Apac companies. The portfolio managed by EQT’s infrastructure team in Asia Pacific employs around 11,000 people.
The transaction is subject approvals and is expected to close in Q4 2024. EQT was advised by JP Morgan on financials, Kim & Chang for legal, and PwC for financial and tax.
With this transaction, EQT Infrastructure VI is expected to be 45-50% based on target fund size and subject to customary regulatory approvals.
Meanwhile, EQT is looking to raise around $12.5 billion for EQT Private Capital Asia's BPEA Private Equity Fund IX, according to an announcement issued on August 14.
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