Blackstone to pay $4.7bn for Ancestry

November 2020 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

November 2020 Issue

In a transaction valued at $4.7bn, private equity (PE) funds managed by investment firm Blackstone have reached a definitive agreement to acquire genealogy provider Ancestry from a consortium of PE firms.

With more than 3 million paying subscribers across its Ancestry online properties and more than $1bn in annual revenue, Ancestry is the global leader in digital family history services, operating in more than 30 countries. The company harnesses the information found in family trees and historical records to help people gain a new level of understanding about their lives.

This transaction represents the first control acquisition for Blackstone’s flagship private equity vehicle Blackstone Capital Partners VIII – its largest ever PE fund which raised $26bn from investors in 2019.

“We are very excited to partner with Ancestry and its management team,” said David Kestnbaum, a senior managing director at Blackstone. “We believe Ancestry has significant runway for further growth as people of all ages and backgrounds become increasingly interested in learning more about their family histories and themselves.”

In addition to its genealogy services, Ancestry also operates a market-leading consumer genomics business, which informs consumers about their heritage and key health characteristics.

“We look forward to investing behind further data, functionality and product development across Ancestry’s market leading platform to continue to provide a differentiated service,” continued Mr Kestnbaum. “Our investment is a prime example of Blackstone’s continued, high-conviction focus on investing in growing, digital consumer businesses, which are resilient in the current environment and beyond.”

One of the world’s leading investment firms, Blackstone’s asset management businesses, with $564bn in assets under management (AUM), include investment vehicles focused on PE, real estate, public debt and equity, growth equity, opportunistic, non-investment grade credit, real assets and secondary funds, all on a global basis.

“Our entire leadership team is thrilled to have the opportunity to partner with Blackstone,” said Margo Georgiadis, president and chief executive of Ancestry. “This deal will allow us to accelerate Ancestry’s global leadership in family history and consumer genomics, and to help us achieve our mission to empower journeys of personal discovery to enrich lives.”

Blackstone is acquiring Ancestry from PE firms Silver Lake, Spectrum Equity, Permira and Singapore’s sovereign wealth fund GIC, which has confirmed that it will continue to retain a significant minority stake in the company.

“Ancestry is the clear leader in helping people discover, preserve, and share their family histories,” said Choo Yong Cheen, chief investment officer of PE at GIC. “As a long-term investor, we are proud to have contributed to Ancestry’s family history mission since 2012, and we are confident the team will continue to innovate for years to come.”

Morgan Stanley & Co. LLC served as lead financial adviser to Ancestry, while Barclays also served as financial adviser. Latham & Watkins LLP is serving as legal adviser to Ancestry and Simpson Thacher & Bartlett LLP is serving as legal adviser to Blackstone. Committed debt financing for the transaction was provided by Bank of America and Credit Suisse.

Ms Georgiadis concluded: “Looking ahead, in collaboration with Blackstone, we will continue to leverage our unique content, powerhouse consumer brand and technology platform to expand our global family history business while bringing to life our long-term vision of personalised preventive health.”

Fraser Tennant