CoStar’s CoreLogic-takeover Faces Bidding War with Warburg Pincus and GTCR

CoStar Group Inc. is interested in acquiring CoreLogic Inc. but so far hasn’t gained traction in discussions, making a deal between the two real-estate data providers more difficult to reach, according to people familiar with the matter.

CoStar’s advisers have indicated the company is interested in exploring a takeover of the software company for $77 to $83 a share, the people said, asking not to be identified because the matter is private.

CoStar, however, has balked at the terms of a non-disclosure agreement sought by CoreLogic, believing the terms are too onerous, one of the people said. CoStar, which owns the website Apartments.com, believes CoreLogic should engage in a formal sales process, they said.

“We have provided a standard NDA to Costar that is consistent with what other parties have signed,” a spokesperson for CoreLogic said, referring to the non-disclosure agreement. “We stand ready to engage if they are at similar values to others.”

Separately, a private equity consortium consisting of Warburg Pincus and GTCR has indicated it’s interested in pursuing at deal at $80 a share or more, and has signed the non-disclosure agreement in order to gain access to CoreLogic’s financials, the people said.

Shares Rise
CoreLogic’s shares closed Wednesday at $76.23, up 12% from $68.25 before it disclosed takeover discussions. The shares rose as much as 2.7% Thursday and were up 0.5% to $76.63 at 1:48 p.m. in New York trading, giving the Irvine-California-based company a market value of $6.08 billion.

Other parties have also come forward since the company disclosed Wednesday that it was engaging with various third parties, one of the people said.

It’s possible that none of the discussions will lead to a formal offer or agreement, the people said.

Representatives for Washington-based CoStar, Warburg Pincus and GTCR declined to comment.

The takeover discussions come after two of CoreLogic’s investors, Cannae Holdings Inc. and Senator Investment Group, offered to buy the software company in June for roughly $7 billion, including debt. The two have since increased their offer to $66 a share, and indicated they may raise their bid subject to due diligence. They have also called on the company to run a full sale process.

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CoreLogic has rebuffed the overture from Cannae and Senator, arguing it undervalues the company. The dispute will come to a head on Nov. 17 when shareholders will be asked to vote on slate of nine directors put forth by Cannae and Senator. It’s unclear whether a deal could be reached prior to the scheduled meeting, one of the people said.

Source: Bloomberg