Ireland’s biggest estate agent Sherry FitzGerald has been sold to CastleGate Investments, an investment fund controlled by entrepreneur and founder of eShopWorld Tommy Kelly.
The sale price has not been disclosed but it is understood CastleGate has agreed to pay about €50 million to acquire the entire business. Based on that figure, co-founder and chairman Mark FitzGerald stands to net about €25 million for his 50 per cent stake in the business. Other executives at the group set to benefit from the windfall are chief executive Steven McKenna, Sheila O’Flynn, Michael Grehan, Ivan Gaine, Simon Ensor, Clair Cullinan and Marian Finnegan.
PwC advised Sherry FitzGerald on the transaction.
Mr FitzGerald (65) will step down as chairman of Sherry FitzGerald and become a strategic adviser to the board. He will be succeeded as chairman by Roy Barrett, the chief executive of CastleGate Investments. Mr Barrett is also chairman of the FAI and was formerly the head of Goodbody Stockbrokers until its sale to AIB.
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Mr FitzGerald stepped down as chief executive of the company in 2017 to become its chairman.
The deal has been approved by the Central Bank and Sherry FitzGerald staff and franchisees were informed of the transaction on Tuesday.
In a statement, CastleGate said it would support Sherry FitzGerald’s growth strategy through “investment in its people, its standout brand, and its highly regarded technology offerings across property and financial services”.
The company will retain the Sherry FitzGerald brand and Mr McKenna will remain as group chief executive, alongside his entire senior management team.
[ Mark FitzGerald to step down as CEO of Sherry FitzGeraldOpens in new window ]
[ Sherry Fitz boss sells his D6 family home for just under €5mOpens in new window ]
Commenting on the transaction, Mr McKenna said, “I am delighted that we are starting a new chapter with such a dynamic and forward-thinking investor. CastleGate Investments share our ambition for the future and supports our commitment to the highest standards of service in the industry. As a former adviser to the company, Roy understands the sector, the business and its professional ethos and ambition for its clients.”
Mr Barrett, who advised Sherry FitzGerald previously when it floated on the stock market, said CastleGate was “excited” to invest in Sherry FitzGerald. “Building on its success to date we see great scope for incremental growth and added value services for Sherry FitzGerald customers alongside excellent career progression opportunities for group and franchisee colleagues. We’ve been very impressed by the management team and their vision for the future, and we are delighted to be part of that journey,” he said.
Mr FitzGerald said: “In the forty years since the business was founded, we have retained the mindset of a challenger brand in terms of what we do and how can we do it better. Our excellent management team embraces that approach as does Tommy Kelly, Roy Barrett and CastleGate. Irish housing is a complex subject, and we were keen to find investors who had a curiosity to improve the experience for consumers, rather than just follow economic activity. When we sat down with Tommy and Roy we found like minds.”
CastleGate Investments is a private family office managing a fund on behalf of Mr Kelly. It holds a global investment portfolio that is invested across both public and private markets, much of it with a technology bias. It recently led a €21 million funding round for Dublin-based IT security company CWSI.
Mr Kelly is an entrepreneur and digital expert who sold his remaining 49.9 per cent stake in ESW in March 2021, a deal that valued the business at more than €1 billion.
Sherry FitzGerald is 40 years old and has about 100 offices across the State, including 70 operated by franchisees. In recent years, the company has invested heavily in technology to build a mortgage broker platform to assist buyers securing home loans. Its ambition is to become one of the biggest players in this space.
Last year The Irish Times revealed that Sherry FitzGerald had hired PwC to advise on strategic options to bring a new investor on board to help fund its growth over the next five years.
