Packer lifts stake in US property site
The billionaire's share of the Nasdaq-listed Zillow now stands at 9.3 per cent, up from 4.7 per cent. He raised $261 million last month by selling holdings in the online employment site and boutique funds group.
Cavalane Holdings bought about 3 million shares on behalf of Mr Packer's Consolidated Press International Holdings, the Seattle-based Zillow said in a filing in the US, without giving financial terms.
The stake is valued at $298 million based on Zillow's last closing price.
Cavalane, an investment vehicle controlled by Mr Packer, is Zillow's largest shareholder after the Australian funds management firm Caledonia Private Investments, which has a 16 per cent holding.
Caledonia, a boutique fund with more than $3 billion under management, has a history of using its clout in corporate transactions.
According to its website, Zillow runs the largest real estate advertising network in the US, in partnership with Yahoo!, real estate search engine Yahoo!Homes. As well as its real estate database, it offers mortgage and financial advice from in-house economists and specialists.
Mr Packer's purchase of a larger stake in Zillow comes amid a recovery in the US housing market. Zillow shares rose almost 3 per cent to $US99.09 on Tuesday.
The Crown chairman's decision to sell holdings in Seek and Magellan last month was expected to raise funds to pay down debt and make other investments.
His Seek holding represented a residual stake of 4 per cent of the company. Seek was founded by the Bassat brothers in 1997, and Mr Packer bought in in 2003. Investing $33 million for a 25 per cent stake, Mr Packer sold most of his stake six years later, making a profit of more than $440 million.
At its recent annual results, Seek said it was reaping the benefits of diversifying into education and international markets, after more than doubling profit in the face of a sluggish domestic jobs market.
Underscoring the pressure from the Australian economy, revenue from the domestic job listing business declined 5 per cent.
Mr Packer has built a reputation for being able to pick online winners.
Frequently Asked Questions about this Article…
James Packer, the Crown chairman, increased his stake in US real-estate website Zillow — raising his holding from 4.7% to 9.3%. The purchase was made via Cavalane Holdings on behalf of his Consolidated Press International Holdings.
Cavalane bought about 3 million Zillow shares for Packer, and the 9.3% stake was valued at roughly US$298 million based on Zillow’s last closing price reported in the article.
He raised about $261 million last month by selling holdings in the online jobs site Seek and the investment fund Magellan. Those sales were expected to help pay down debt and fund other investments.
Cavalane Holdings is an investment vehicle controlled by James Packer. In this transaction it bought shares on behalf of Consolidated Press International Holdings, Packer’s broader investment vehicle.
After Packer’s increase, Cavalane (Packer) is one of Zillow’s largest shareholders, second to Caledonia Private Investments, which holds about 16% of the company. Caledonia is a boutique fund with more than $3 billion under management.
Zillow runs the largest real-estate advertising network in the US and partners with Yahoo! Homes. It provides a real-estate database and offers mortgage and financial advice from in-house economists and specialists — services that make it central to the US housing and property-ad tech market.
Zillow shares rose almost 3% to US$99.09 on the Tuesday referenced in the article, reflecting positive market reaction amid a recovery in the US housing market.
Packer has a track record of picking online winners: he originally bought into Seek in 2003 (paying $33 million for a 25% stake) and sold most of his holding six years later for a profit of more than $440 million. The article notes Seek later diversified into education and international markets and more than doubled profit, illustrating how early picks and strategic exits can pay off.
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