New York—Primedia has put its business information unit, which generated $224.8 million in revenue in 2004, on the auction block.
The company announced Monday that it has retained Credit Suisse First Boston to assist it in exploring the sale of its business information segment.
"Over the past year, the business information segment has turned around, with accelerating revenue and earnings growth," Kelly P. Conlin, Primedia president-CEO, said in a statement. "When these results attracted the attention of several qualified buyers, the company felt that our shareholders would be best served by evaluating these offers in the context of a competitive review of the value of our business information segment. This is consistent with our goal of focusing on both operating growth and financial deleveraging."
The business information segment consists of 70 publications, more than 100 Web sites, 25 events and 50 directories and data products. Key properties include Ward’s Auto World, Telephony and Registered Rep.
The unit’s EBITDA (earnings before interest, taxes, depreciation and amortization) was $37.4 million in 2004. An EBITDA multiple of 10 times would produce a sale price of $374 million.
"It will likely be a financial player [that buys Primedia Business]," said Joel Novak, managing director at communications industry investment bank Berkery, Noyes & Co. "There will be a lot of disappointed buyers who were going after Hanley Wood. So in this environment, this is an attractive property that might get a 12-times multiple."