Prism agrees to acquire Penton in $530 million deal

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Wasserstein & Co.'s U.S. Equity Partners II expands its footprint in business media

In a move that greatly expands the presence of investment banker Bruce Wasserstein in the b-to-b media arena, Prism Business Media announced Nov. 2 that it had agreed to acquire Penton Media in a deal valued at $530 million.

The deal, which includes the assumption or repayment of roughly $336 million in debt, is expected to close in the first half of 2007. It represents the largest M&A transaction in b-to-b media since the $650 million acquisition of Hanley Wood by a consortium led by JP Morgan in 2005.

After going into play this past summer, Penton sparked the interest of several bidders. In the final few weeks before the deal was announced, there were rumors that the bidding had come down to b-to-b media holding company Apprise Media and Prism, which is owned by U.S. Equity Partners II, an investment fund sponsored by Wasserstein & Co.

Wasserstein also owns ALM and, along with Rustic Canyon Ventures, The Deal LLC. His first foray into publishing was in 2004, when he swooped down at the 11th hour to purchase New York Magazine. Unlike in that deal, Wasserstein & Co. was aiming for Penton from the get-go.

John French, CEO of Prism, said in a statement: "Together, Penton and Prism provide a compelling combination of leading brands and integrated media products for businesses readers and marketers across a wide diversity of vertical industry segments." He would not offer additional comments about the deal beyond the press release, said Lee Feldman, a spokesman for Prism.

Prism is expected to integrate Penton properties into its portfolio, according to a person familiar with the transaction.

Good strategic match

"The companies match up strategically extremely well," said Tom Kemp, a managing director at media bank Veronis Suhler Stevenson and former chairman-CEO of Penton. "They're in very similar markets, but they're more complementary, not competitive."

Prism has 70 b-to-b titles in 19 vertical markets, including agriculture, construction, electrical, financial services, meeting and event planning, real estate and transportation. Penton has 50 b-to-b titles in 15 markets, including economic development, electrical, enterprise IT, manufacturing and mechanical systems/construction.

Both companies have expanded their business this year. In September, Prism acquired SpeedNews, which provides news and information for executives in the aviation industry; earlier this month was the debut of the IWCE/MRT Wireless Summit, which is being marketed by Prism's Mobile Radio Technology.

Penton's recent ventures

In October Penton's Lodging Hospitality launched LHTV, an online, streaming video offering for the lodging industry. And in September, Penton's New Hope Natural Media acquired NPIcenter, an online information resource for professionals in the nutraceutical, nutritional, dietary supplement, cosmetic and food industries.

On the same day it announced it was acquiring Penton, Prism said it had acquired the assets of Supermarket News from Fairchild Publications. Financial terms were not disclosed. The magazine, founded in 1952, produces the Supermarket News Whole Health supplement, which covers the organic, whole health and wellness markets.

Last week, Wasserstein & Co. denied a published report that U.S. Equity had been exploring a sale of ALM. The report was published online by the Daily Telegraph. The U.K.-based newspaper said U.S. Equity has been holding talks to sell ALM for a potential $700 million. M

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