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Providence Equity in talks to buy RentPath — Reuters

(Reuters) – Providence Equity Partners LLC is in discussions with TPG Capital LP to acquire a majority stake in RentPath Inc, a real estate listings company known for its Apartment Guide and websites, according to people familiar with the matter.

Providence Equity has so far prevailed in the auction for RentPath, which attracted other private equity firms, as well as commercial real estate information services provider CoStar Group Inc (CSGP.O: Quote, Profile, Research, Stock Buzz), the people said on Monday.

A deal is far from certain and is contingent on Providence Equity obtaining financing from banks. Some of the banks have been reluctant to agree to the terms for fear of falling afoul of the leveraged lending guidance issued by U.S. regulators to curb the issuance of risky loans, the people added.

Buyout firm TPG is negotiating with Providence Equity to keep a minority stake in the company, the people said. Any deal would likely value RentPath at less than the $1.5 billion TPG was hoping the company would fetch, they added.

The sources asked not to be identified because the talks are confidential. Providence Equity and TPG declined to comment, while RentPath and CoStar representatives did not respond to requests for comment.

Formerly known as Primedia, RentPath provides digital classified advertising for apartment leasing and new home sales on several of its websites that reach over 7 million unique visitors a month, according to the company.

TPG bought RentPath for $525 million in 2011 from KKR & Co LP (KKR.N: Quote, Profile,Research, Stock Buzz).

A sale of Norcross, Georgia-based RentPath would follow a spate of real-estate website deals. Real estate agents and brokers are expected to spend $14 billion in 2014 on online advertising, which has grown nearly 30 percent over the past two years, according to research firm Borrell Associates.

News Corp NSWA.O said last month it would buy Move Inc (MOVE.O: Quote, Profile, Research,Stock Buzz), the owner of property websites such as, for about $950 million.

The biggest deal so far this year was the purchase by top U.S. real estate website operator Zillow Inc (Z.O: Quote, Profile, Research, Stock Buzz) of smaller rival Trulia Inc (TRLA.N: Quote, Profile,Research, Stock Buzz) for $3.5 billion. was sold to CoStar Group in March for $585 million.