Exits – EDP scores first exit with Bidlet

The UK online auction business QXL.com in late March acquired Bidlet, a Scandinavian online auctioneer, in a share-for-share exchange that valued the target at 576 million ($534 million).

The deal was the first exit from European Digital Partners’ portfolio and followed closely on the announcement of its $100 million fund raising (EVCJ April 2000, page 8). European Digital Partners (EDP) is a joint venture between Arkwright Capital Partners, Internet consultancy Halogen and executives of Kohlberg Kravis Roberts that has inherited the 10-strong Arkwright investment portfolio.

Bidlet was formed in 1998 when PC Express, a Swedish online and mail-order computer retailer introduced website auctions to boost sales of its own product lines. The concept was a great success and, in June 1999, the auction site spun out from PC Express under the Bidlet name, opening the way for it to offer a broader general auction service. Arkwright Capital Partners took a 10 per cent stake in Bidlet shortly after the spin-out and in partnership with Halogen, played an active strategic role in the company’s subsequent development and the implementation of its ambitious roll-out strategy. (Lennart Eriksson, Halogen’s chief technical officer assumed the parallel role at Bidlet).

Prior to the approach from QXL, EDP had appointed Enskilda to advise on a possible summer IPO for Bidlet, but EDP judged that the potential synergistic benefits arising from a merger with QXL provided a greater value opportunity.