LONDON (Alliance News) - A string of private equity firms have abandoned offers for Tesco PLC's Dunnhumby customer data unit, according to a report by Sky News.
Sky News reported that interested parties including Apax Partners, CVC Capital Partners, Clayton Dubilier & Rice and TP, have either pulled out of the running to acquire Dunnhumby or are losing interest, after Tesco struck a five-year deal with the business that has left them concerned about financing, as once the arrangement expires in 2020, the new owner would have to secure a new deal.
Dunnhumby, which manages Tesco's Clubcard loyalty scheme, is now valued at well under GBP1 billion, according to Sky News, which is less than half the original estimate.
General Atlantic Partners, which had been involved in a joint bid with marketing services giant WPP Group, has also reportedly decided against pursuing its interest.
http://news.sky.com/story/1548835/bidders-abandon-auction-of-tesco-data-unit
On Monday, Tesco revealed that it has struck a deal to sell its Homeplus business in South Korea to a consortium led by private equity group MBK Partners for GBP4.24 billion, the first major asset sale the company has completed since it outlined plans to offload businesses in order to cut its debt pile following a turbulent 2015 financial year.
Dunnhumby was put up for sale by the retailer earlier this year with a price tag of up to GBP2 billion, but the Financial Times, citing two people familiar with the auction, reported that bidders are now understood to be considering offers of around GBP700 million, having found the business was less profitable than thought.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
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