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July 18, 2022updated 07 Oct 2022 7:10am

Euromoney accepts £1.7bn private equity takeover bid: Who are Astorg and Epiris?

By Bron Maher

The company behind Euromoney, the London-based finance magazine, has accepted a buyout from two private equity firms.

Euromoney Institutional Investor Plc accepted the £1.7bn deal on Monday morning.

Paris-based Astorg and London-based Epiris approached the FTSE 250 company with the offer in June.

It was their fifth attempt: previous offers ranged from £11.75 to £13.50 per share, according to the Financial Times.

The accepted offer, coming in at £14.61 a share, represented a premium of 33.5% on Euromoney’s £10.94 share price prior to the approach.

It is also 21.5 times Euromoney’s EBITDA for the year to the end of September 2021.

Euromoney is not Epiris’ first investment in the media: it bought NME and Marie Claire from Meredith Corp, then parent company to Time Inc, in February 2018. Epiris has since sold both titles, but not before shutting NME and Marie Claire’s print editions.

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Astorg has less history with the media: in 2014 it purchased a majority stake in Luxembourg-based satellite television business M7 Media, but it sold the company in 2019.

Astorg says on its website it is “only interested in making investments in global B2B companies, with market leading positions, that sell highly differentiated products or services”.

Astorg and Epiris appear to have gone 50/50 on the deal: the vehicle for the acquisition, an entity formed last week named “Becketts Bidco Limited”, is the wholly-owned subsidiary (via “Maggots Midco Limited”) of “Hangar Holdco Limited”.

The latter company is co-owned by a Jersey-based Epiris subsidiary and what appears to be a Luxembourg-based Astorg subsidiary.

Astorg and Epiris plan to divide up Euromoney should the plan receive the necessary 75% approval from shareholders.

Fastmarkets, which provides up-to-date information on commodities prices, will be controlled by Astorg. The rest of the Euromoney businesses, including the magazine as well as asset management and financial and professional services, will be retained by Bidco, which by then will be majority-owned by Epiris.

In the announcement of the acceptance, the private equity firms cited Euromoney’s “3.0 strategy” restructure as a factor in the purchase.

“The strategy delivers high-quality profitable growth by providing information services embedded in customers’ critical workflows through actionable intelligence and insights, that are characterised by resilient and robust recurring subscriptions revenue,” they said.

In its nine-month results, also released on Monday, Euromoney announced 7% growth in subscription revenue in the three-quarters of the year to the end of June. Whole group underlying revenue growth was 20%, rising to £304.3m.

Asked about the valuation placed on the group, Euromoney’s PR advisers FTI Consulting said: “The nub of it is: what does [an investor] actually want? They want reliable revenue, recurring revenue, sticky revenue. And that’s what Euromoney does. They get 70% of their revenue from subscriptions; they tend to be recurring and they’re growing very well…

“If you think about the macro world we’re in, they’ve got a really nice business.”

Asked in March about a recent rise in media mergers and acquisitions, analyst Cyrus Mewawalla of Globaldata told Press Gazette: “In one sense, people are buying the technologies they need to succeed and in another rationale, they’re going to have defensive mergers so that they can they can be bigger and protect themselves against tech.”

Abi Watson of Enders Analysis said it was easier and less risky to take on debt under the prevailing macroeconomic conditions. This was truer at the time of the article – the Bank of England base interest rate is now 1.25%, compared with 0.5% in March.

Deloitte analyst Andrew Evans told Press Gazette last month, when explaining the deteriorating SPAC market, that even with a potential domestic recession looming he predicted a continuation of “corporate transactions, M&A disposals, buying new technology, selling old technology, carving out nonprofits”.

Press Gazette is hosting the Future of Media Technology Conference. For more information, visit NSMG.live

Picture: Manakin via Getty Images

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