Akita Michinoku Capital Says Blackstone Agrees on $4.7 Billion Ancestry.com Acquisition

Aug 05, 2020

TOKYO–(BUSINESS WIRE)–Analysts at Tokyo-based wealth management company Akita Michinoku Capital have said that renowned alternative asset manager, Blackstone Group Inc. is ready to acquire around 75% of Ancestry.com Inc., the business known for DNA testing and family history research.

“The deal is valued at $4.7 billion, including debt, with Singaporean sovereign-wealth fund GIC Pte, who purchased a stake in 2016, continuing to own around 25%,” said Martin Thornton, Head of Corporate Trading at Akita Michinoku Capital. “This acquisition will be the first from Blackstone’s biggest ever private equity fund,” he added.

Headquartered in New York, Blackstone is flush with cash as investors keep betting big on the company despite the uncertainty triggered by the Covid-19 pandemic. In recent months, executives have reported success in surviving the financial crisis of 2008 to prove that the business, which has $156 billion in dry powder, would be better placed to take advantage of the latest upheavals.

Many of Blackstone’s recent investments have been in growth companies and businesses expected to profit from shifts in consumer habits. The group announced last month it was investing in popular plant-based drink, Oatly AB, which has partners including Oprah Winfrey. The company also holds a controlling stake in MagicLab, the creator of the dating app Bumble.

“The Ancestry.com deal negotiations began a few months back when most of the world was sat at home looking for stuff to do,” said Oliver Wright, Director of Corporate Equities at Akita Michinoku Capital. “The deal could be announced as early as Wednesday,” he added.

Ancestry.com is headquartered in Lehi, Utah and has over 3 million paying subscribers and over 18 million people on its DNA network. It sells at-home DNA testing kits to customers and competes with 23andMe Inc.

In 2009, Ancestry.com first went public and raised $100 million. In 2012, it went private in a $1.6 billion buyout deal led by private equity firm Permira and has since considered going public again on at least two occasions, though it never got the valuation it was aiming to achieve.

Four years ago, Silver Lake and GIC purchased a majority stake in a deal which valued the business at $2.6 billion. Prior owners, including management, Permira and Spectrum Equity, also hold minority interests in the company.

According to data collected by Akita Michinoku Capital, Blackstone, the world’s largest alternative asset manager with assets worth $564 billion, is now focused on expanding its life sciences business. It has invested more than $1 billion this year on drugs that target high cholesterol, kidney disease in children and devices for patients with diabetes.

In early 2020, as values fell and markets became increasingly volatile, the firm purchased $11 billion of public equities and liquid debt. It also took stakes in businesses including 21Vianet, a Chinese data centre company, and a Hollywood film studios portfolio.

About Akita Michinoku Capital

Established in 2009, Akita Michinoku Capital is a respected wealth management company with a global network reaching over 40+ countries. By uniting financial markets from East to West, we can support our clients through all facets of wealth management and provide our clients with the best possible investment performance through a broad range of investment products.

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Mr. James Kenta, Head of Research.

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