Zoopla owner ZPG has snapped up a Netherlands-based property company, just weeks after its massive takeover bid for GoCompare was overwhelmingly rejected.
ZPG, which also owns GoCompare rival USwitch, made a secret takeover bid for GoCompare on 8 November.
The offer of 110p per share represented an 18.5% premium to GoCompare’s closing price at the start of the week, valuing the business at around £460 million.
But GoCompare wasn’t impressed. It said its board had “unanimously and unequivocally” rejected the takeover approach, which it described as “highly opportunistic”.
ZPG, headed by entrepreneur Alex Chesterman (pictured), has confirmed it won’t be making a further offer.
It was thought ZPG could have used GoCompare to increase the number of general insurance products on its site and transfer more non-insurance products onto GoCompare, which demerged from esure a year ago.
Sir Peter Wood, chairman of GoCompare, said: “The board believes that ZPG’s proposals fundamentally undervalued GoCompare’s prospects and therefore we unanimously and unequivocally rejected them.
“We strongly believe that GoCompare can deliver superior shareholder value as an independent company. We are all excited by GoCompare’s continued evolution as an entrepreneurial, innovation-focused company with the ability to save people everywhere time and money.”
ZPG has been on an acquisition spree over the past year. Today it announced the acquisition of Calcasa, a provider of residential property market analysis in the Netherlands, to bolster the services offered by Hometrack, which it bought in January.
ZPG also acquired financial services comparison website Money.co.uk in October, and snapped up online letting agency software provider Expert Agent in March.
The company has a market capitalisation of around £1.5 billion despite only being founded a decade ago.
Other than its failed bid for GoCompare, things are looking rosy for the Zoopla owner.
Full year results show revenues leapt by 24% to £244.5 million in the 12 months to 30 September, although pre-tax profits were held back by acquisition costs, rising by just 4% to £48.1 million.
Price comparison site revenues rose by 10% to £122.2 million, while property division revenues soared 41% to £122.3 million.
Chesterman said sales in the property division were driven by strong demand for its additional products, further migration of software partners to cloud-based products and a continuation of returning portal partners.
“We significantly enhanced the partner cross-sell opportunity with the successful integration of our acquisitions in website, software, data and print products and saw the average number of products per partner increase by 27% over the period,” he said.
Chesterman added: “Looking ahead, we are very excited by both the underlying growth opportunities in each division and the unique and unrivalled cross-sell opportunities we have created as we continue on our mission to be the platform of choice for consumers and partners engaged in property and household decisions.”
DealMakerz reckons 2018 will see even more deal news from ZPG, which clearly views the acquisition of profitable property and comparison site companies as a key growth strategy.
It’s certainly one of the ways in which ZPG can strengthen its position and diversify against any market swings.
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