Euromoney Institutional Investor, a financial publisher, is one of the few private take deals agreed upon during market turmoil, accepting a £ 1.7 billion takeover bid from private equity groups Astorg and Epiris. I did.
The board of directors of FTSE250 listed companies Buyout offerAstorg said on Monday that it plans to split the business in two and provide it to shareholders.
The transaction will value Euromoney shares at £ 1.6 billion and a corporate value of £ 1.7 billion. This is about 21.5 times the interest, taxes, depreciation and pre-amortization income for the year to September 2021, which is a relatively high number for a buyout transaction. According to a Bain & Co report, this is above last year’s average of 19.3 times more private trading.
Under this agreement, Astorg will manage Euromoney’s Fastmarkets division and provide price reports for raw materials such as wood and metals. Epiris will take over other divisions, the asset management business, including the publication of Institutional Investor Magazine, and the financial and professional services division, which operates BoardEx and Wealth-X information services.
“Thank you for the anxiety about this kind of change,” Euromoney CEO Andrew Rashbass said in a letter to the staff and was seen in the Financial Times. The business will be split within a year of the deal, “unfortunately some core roles will no longer be needed,” he said.
Rashbass added that Euromoney’s board “resolutely rejected” four low offers from the acquisition group, but “eventually.” .. .. Taking into account the global economic and geopolitical uncertainties, the board can be confident that it can quickly provide sufficient value to shareholders compared to the current certainty of a fair-priced sale. I had to ask myself if. ”
The bid price of £ 14.61 per share is 33.5 percent above the closing price of Euromoney before the private equity offer was announced.
Buyout groups are particularly attracted to Euromoney subscription revenue, according to the latest transaction information released on Monday. This increased by 7% in the nine months to June 30th.
The sale was approved at a time when trading slowed significantly as inflation, rising interest rates and the Ukrainian war regained confidence. Major deals, such as the planned sale of British chemist chain boots by the US parent Walgreens Boots Alliance, fell Due to difficult situations such as rising borrowing costs to fund leveraged buyouts.
Global M & A activity fell 21% in the first half of this year compared to the same period in 2021. This is indicated by the Refinitiv numbers.
Previous Euromoney offers from Astorg and Epiris ranged from £ 11.75 to £ 13.50 per share. Their latest proposal will require the support of 75 percent of shareholders to move forward.
“We continue to believe that the company’s underlying value is higher than the 1461p offer,” an investec bank analyst said in a Monday note. “Tightening the bond market could have eased expectations. There is. ” Berenberg analysts said they expect shareholders to accept it.
The UK company, which owns a financial magazine for Euromoney and runs an exhibition, has been hit by a pandemic, but previously stated that rising demand for data services helped the recovery. Chief Financial Officer Wendy Parrot said in October that he was planning an acquisition.
After the announcement on Monday, Euromoney’s share price rose 9.5% to £ 14.52.
Euromoney accepts £ 1.7 billion private equity offer
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