TA Associates finalises the sale of its 12.6% stake in Auction Technology Group (ATG) for £84.4m, relinquishing significant ownership.
- The private equity firm acquired its stake in ATG in 2020 and has progressively reduced its shareholding from an initial 17.6%.
- ATG, noted for facilitating significant auction sales, reports impressive financial growth despite decreasing share prices.
- The sale price of £5.50 per share represents a 30% decline from ATG’s initial public offering value.
- Morgan Seigler, TA Associates’ managing director, is set to depart from ATG’s board following the transaction.
TA Associates, a prominent private equity firm, has concluded the sale of its entire 12.6% stake in Auction Technology Group (ATG), for £84.4 million. This sale represents a significant divestment of 15,337,625 ordinary shares at £5.50 per share, a 30% reduction from the company’s initial public offering price of 780p. The sale illustrates a decisive shift in TA Associates’ investment strategy.
TA Associates initially acquired ATG in 2020 from ECI Partners, concurrently purchasing Proxibid, an online marketplace, from Primus Capital. This aggregation brought Proxibid under ATG’s umbrella, enhancing its service offering in digital auctions and online marketplace software, which boasts the facilitation of sales for 20 million auction items annually.
Though TA Associates initially held a 17.6% stake, it reduced this to 12.6% in June. This strategic reduction prefaces the complete divestment. ATG continues to demonstrate robust business performance, as evidenced by a 13% rise in annual revenue for the fiscal year ending September 2023, reaching £135.2 million. The firm also recorded a 34% increase in operating profit, totalling £22.5 million, aided by a managed reduction in the cost of sales.
Despite its financial success, ATG’s share price experienced a 3% drop to 565p early on a Thursday morning before rallying to 604p. The volatility suggests investor interest remains high, but market pressures continue to influence stock performance.
Morgan Seigler, managing director at TA Associates, will be resigning from ATG’s board of directors following this transaction. This move can be seen as a natural consequence of the firm’s complete exit from its investment in the company. ATG’s presence is notable both in the UK and overseas, with significant operations in the US.
TA Associates’ complete exit signals a strategic refocus, as Auction Technology Group continues to perform strongly in the digital auction market.
