Naspers sells online auction site Allegro for $3.25 billion

October 17, 2016 01:47 PM

(Bloomberg) -- Cinven Ltd., Permira and Mid Europa Partners agreed to buy Naspers Ltd.’s Polish online auction site Allegro for $3.25 billion, taking on rivals such as eBay Inc. in the eastern European country.

The deal is part of Cape Town-based Naspers’s strategy to profit from its investments, according to a statement from the company Friday. Naspers bought Allegro in 2008 for about $1.5 billion. The acquiring group beat out other private-equity consortia including CVC Capital Partners and General Atlantic and a group composed of Advent International Corp. and Hellman & Friedman LLC, people familiar with the matter had said.

Naspers rose earlier in the day after Bloomberg first reported on the sale. The stock gained as much as 6.4% in Johannesburg and was trading 5.8% higher to 2,318.95 rand at 4:14 p.m., giving the company a market value of over 1 trillion rand ($71 billion).

Naspers is facing challenges from U.S. technology companies and weaker African currencies as the continent’s biggest company by market value tries to grow its internet and pay-TV businesses. Naspers hired Morgan Stanley to advise on a potential sale of Allegro, people familiar with the plans said in June.

Allegro, which is similar to U.S. website eBay, is the no. 1 e-commerce platform in eastern Europe with more than 14 million monthly users, according to Naspers’s website.

If completed, the deal will be one of the five largest acquisitions of a Polish asset ever, according to data compiled by Bloomberg. Companies in the country have announced $3.5 billion in mergers and acquisitions this year, down about 50% from the same period a year ago.

Naspers plans to use the proceeds to repay debt, fund its e-commerce businesses and finance new acquisitions. Naspers said it remains committed to its remaining assets in Poland, including online and mobile payment provider PayU.




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