CoStar Group Makes $6.9B Competing Bid to Buy CoreLogic
By Nicholas Rizzi February 16, 2021 10:29 amreprints
Commercial real estate data giant CoStar Group made a competing bid to acquire CoreLogic for $6.9 billion, soon after CoreLogic agreed to be bought out by two private-equity firms, CoStar announced on Tuesday.
CoStar previously tried to buy CoreLogic, which also provides real estate and mortgage data, but the Irvine, Calif.-based firm entered into an agreement to be purchased by Stone Point Capital and Insight Partners for $6 billion earlier this month. The new bid would be an all-stock buyout, while Stone Point and Insight’s offer was an all-cash deal.
In a letter written to CoreLogic’s board, CoStar wrote that it was “stunned” CoreLogic agreed to an “inferior offer” after CoStar had been in talks with the company since October.
“We do not believe the pending transaction maximizes value for CoreLogic stockholders and we continue to believe in the strong strategic rationale for the combination of our two companies,” CoStar wrote.
CoreLogic has been up for sale since last year, when activist investors Cannae Holdings Inc. and Senator Investment Group launched a $7 billion effort to buy CoreLogic, Bloomberg reported. The duo eventually pulled out in June after CoreLogic received higher bids.
News of CoStar’s bid caused CoreLogic’s stock to rise by about 6 percent on Tuesday morning, which CoStar said was “a clear indication that the shareholders agree with us.”
CoStar has been on an apparent quest to control all of the real estate industry’s data in recent years, already owning a slew of apartment listing sites, including Apartments.com and ForRent.com. The Washington, D.C.-based company bought commercial listing platform LoopNet in 2011 for $860 million, hotel data giant STR for $450 million in 2019 and commercial real estate transaction platform Ten-X for $190 million last year.
It also tried to buy RentPath, which operates rental listings platforms, such as Rent.com, last year for $600 million, but the deal was canceled in December after the Federal Trade Commission (FTC) sued to block the sale.
Despite that FTC suit, CoStar wrote in its letter to CoreLogic’s board that it sees “no antitrust risk” if it acquires the firm.