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Analyst Insight: Midmarket play still on in squeeze

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The credit crunch in capital markets isn't having a negative effect on the level of b-to-b media deals, said Tolman Geffs, managing director at media investment bank Jordan, Edmiston Group.

"We're talking more about the Blackstones and the KKRs" among private equity firms that are exposed to the credit crunch, Geffs said. "Middle-market firms are very much in business," he added, pointing to the July acquisition of marketing services company VentureDirect Worldwide by PlattForm Holdings, which is owned by private equity firm Arlington Capital Partners. (Jordan, Edmiston represented VentureDirect in the transaction. Financial terms were not disclosed.)

Strategic players are becoming more actively involved in large acquisitions, too, Geffs said. Unlike private equity firms, which are to varying degrees beholden to banks, strategic companies have cash flow to help inoculate them against the credit squeeze, he said.

"The Corporate Executive Board's acquisition of [community-based Web site] ITtoolbox was an eye-opening and out-of-the-box move," he said. "Strategic buyers are still very disciplined and looking for the right fit, but I'm highly confident they'll continue to look for both bolt-on deals and new ideas."

Community-oriented Web sites, such as ITtoolbox, will continue to command a strong level of interest among b-to-b media buyers, Geffs said.

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