Private equity firms are unlikely to launch a tender offer to take over Informa Plc in the near future, say independent private equity sources.
One UK-based private equity partner said that the investment trust Candover Investments Plc was likely to be considering a new buyout approach for the UK-listed academic and professional publisher and events organiser but that he would be very surprised if something happened between now and the end of June.
The partner did not believe that buyout firm Apax Partners Worldwide LLP was likely to make a bid on its own. Apax is mooted as a potential bidder for Informa because it completed a joint takeover with the Guardian Media Group Plc of business-to-business publisher Emap Plc in March 2008 and then appointed Informa’s former chief executive David Gilbertson to head Emap.
“I guess that the Apax people are suffering from some indigestion right now, they kind of bought an awful lot of stuff at very high prices,” the partner said.
The partner did not think Apax would be able to easily do a deal this size, but that they could approach Candover, should it complete the deal, and make an offer for its data monitor unit.
According to its website, Datamonitor achieved sales of US$250m and provides online data for six industry sectors (automotive and logistics; consumer and retail; energy and utilities; financial services; healthcare and technology).
The partner also believed that Candover had considered taking Informa’s academic publishing and merging it with Springer Science + Business Media AG, the German academic publisher that Candover controlled with its peer Cinven.
The partner pointed out that valuations in the sector have gone down dramatically – Informa’s share price tumbled by about 40 percent after it announced the acquisition of Datamonitor.
Moreover he said that Reed Elsevier Group Plc was expected to sell its Reed Business Information unit for about £1bn which would translate to an EBITDA multiple of 8 times.
He contrasted this with previous takeovers in the sector that had seen multiples of 12 to 13 times EBITDA.
By Alexander Wessendorff