DMGT's Genscape in sale process via Centerview

23 August 2019 - 08:58 am UTC

Daily Mail and General Trust (DMGT), the UK media group, is in the advanced stages of selling its energy information business Genscape, four sources familiar with the situation said.
 
Centerview is acting as sellside adviser, two of the sources said.
 
The Louisville, Kentucky-based company has been shopped to a group of strategic buyers and sponsors in the last couple of months, the sources said. Verisk Analytics, IHS Markit, S&P Global Platts, Wood Mackenzie, and RELX’s ICIS business have been among those around the process, three of the sources said.
 
A listed strategic player is viewed as in pole position to secure Genscape, the third source said, declining to identify the suitor.
 
Genscape is being marketed off EBITDA in the USD 15m-USD 19m range and revenues are around USD 100m, two of the sources said. It provides data analytics and intelligence on capacities, flow and utilization for all major energy commodities.
 
Part of the rationale for the sale is to benefit from soaring valuations fetched by data energy companies, which can go as high as 20x EBITDA, the third source said. DMGT is known for buying start-ups and selling later for a higher return, this source added.
 
Given Genscape’s financial performance, with margins well below the 40% enjoyed by key industry peers, it is more likely to fetch a lower, mid-teen multiple, two of the sources said.
 
In the half year to 31 March 2019, Genscape posted revenues of GBP 37m, flat YoY on an underlying basis. This represented a fall of 14% YoY on a reported basis, as Genscape merged its solar business Locus Energy into AlsoEnergy in September 2018. Its adjusted operating margin for the same period came in at 9% versus 0% YoY.
 
DMGT did not break out Genscape financials in its nine-month trading update published on 25 July.
 
Genscape’s sale effort comes following the sale of DMGT’s stake in ZPG, a UK property portal, to US sponsor Silverlake in 2018. Earlier this year, DMGT sold on-geo, a German real estate data provider, to Tinsa Tasaciones Inmobiliarias, a Spanish consultancy focusing on property appraisal and valuation, for an undisclosed sum.
 
DMGT, RELX, Verisk, Wood Mackenzie and S&P Global declined to comment. Centerview, Genscape, IHS Markit and Platts did not respond to request for comment.

by Amy-Jo Crowley in London, and Bhavna Kaul in New York