Blackstone Inc. is reportedly completing its exit from dating app Bumble Inc., despite Bumble's stock price having fallen by approximately 96.1% since its 2021 IPO. Blackstone acquired a majority stake in Bumble's parent company, MagicLab, for $2.1 billion in 2019, valuing it at $3 billion. By systematically reducing its exposure, Blackstone achieved an internal rate of return (IRR) of 98%.
Blackstone, through an agreement with UBS to sell less than 5% of the company's shares quarterly, is expected to fully exit early next year. Its profitability was based on moving funds before the stock price decline, including using Bumble's debt to issue itself a $334 million dividend in late 2020, and reducing its stake from 83.6% to 53.2% during Bumble's IPO, cashing out nearly $2 billion. In 2021, when the stock price exceeded $50, Blackstone conducted another $1 billion stock sale. By the end of 2023, Bumble's stock price had fallen below $14.
Currently, Blackstone's remaining 22.4 million shares are valued at approximately $66.75 million, significantly less than the $1.084 billion obtained from selling a similar number of shares in 2021. Blackstone has accelerated its stock sales and has withdrawn its two seats on Bumble's board. Meanwhile, Bumble is facing challenges with a 16.4% year-over-year decline in paying users, and analysts believe that private equity groups may be its "most obvious" potential buyers, as public markets exert greater pressure for performance improvement.
Blackstone is reportedly exiting dating app Bumble, having achieved a 98% internal rate of return through systematic operations, despite Bumble's stock price plummeting 96% since its IPO.
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