New York-based global private equity firm Apollo Global Management LLC (NYSE: APO), along with the Ontario Teachers’ Pension Plan Board, agreed to acquire a majority stake in Chicago-based online job search and talent recruitment company CareerBuilder LLC, from leading media companies TEGNA Inc. (NYSE: TGNA), Tribune Media Company (NYSE: TRCO) and McClatchy Company (NYSE: MNI), for roughly $480 million.
As part of the deal, TEGNA will reduce its current 53% controlling interest in CareerBuilder to 12.5%, and expects to receive cash proceeds from the sale of approximately $250 million. Tribune Media will reduce its 32% stake in CareerBuilder to 8%, and expects to receive $157 million in cash proceeds. McClatchy will reduce its 15% stake in CareerBuilder to 3.8%, and its cash proceeds are expected to be approximately $76 million.
CareerBuilder is a global, end-to-end human capital solutions company focused on helping employers find, hire and manage talent. Combining advertising, software and services, the company provides recruiting solutions, employment screening and human capital management. It also operates top job sites in the United States, Europe, South America, Canada and Asia.
“CareerBuilder is a global leader in human capital solutions, and we are excited to work with the Company in the next phase of its growth and development,” said David Sambur, Senior Partner at Apollo. “Matt Ferguson and his team have done an exceptional job capitalizing on CareerBuilder’s iconic brand to create an integrated solutions software-as-a-service (SaaS) platform, and we look forward to working with the team to support the company’s continued growth and innovation.”
Craig Forman, McClatchy’s President and Chief Executive Officer said, “Our CareerBuilder interest has been a valuable asset over the years, and we wish the company well in navigating the future. For McClatchy, the result of the TEGNA-led CareerBuilder transaction will provide after-tax proceeds to further reduce debt and/or potentially use for reinvestment in the company.”
Matt Ferguson, CEO of CareerBuilder, added, “This is an exciting next chapter for CareerBuilder. We are very proud of the work we did during our partnership with Tegna, Tribune and McClatchy, and we look forward to collaborating with Apollo and Ontario Teachers’ to continue the successful transformation of our business.”
The deal includes committed financing from Credit Suisse, Barclays, Deutsche Bank, Citigroup Global Markets and Goldman Sachs & Co. LLC; all are also acting as financial advisors to Apollo, along with LionTree Advisors and PJT Partners. Morgan Stanley & Co. is acting as financial advisor to CareerBuilder. Akin Gump Strauss Hauer & Feld LLP and Paul, Weiss, Rifkind, Wharton & Garrison LLP are acting as legal advisors to Apollo. Wachtell, Lipton, Rosen & Katz LLP is acting as legal advisor to the sellers.
The deal is expected to close in the third quarter of 2017, subject to regulatory approvals and customary closing conditions. Apollo’s investment is being made by the Apollo-managed Special Situations I fund.
Apollo is a leading global alternative investment manager with offices in New York, Los Angeles, Houston, Chicago, St. Louis, Bethesda, Toronto, London, Frankfurt, Madrid, Luxembourg, Mumbai, Delhi, Singapore, Hong Kong and Shanghai. The firm had $197 billion in assets under management as of March 31, 2017 in private equity, credit and real estate funds.
Ontario Teachers’ is Canada’s largest single-profession pension plan, with C$175.6 billion in net assets at December 31, 2016. It holds a diverse global portfolio of assets, 80% of which is managed in-house, and has earned an average annualized rate of return of 10.1% since the plan’s founding in 1990. Ontario Teachers’ is an independent organization headquartered in Toronto. Its Asia-Pacific region office is located in Hong Kong and its Europe, Middle East & Africa region office is in London. The defined-benefit plan, which is fully funded, invests and administers the pensions of the province of Ontario’s 318,000 active and retired teachers.