In the News

Investment banker: "Organic growth" seems to be working best for newsletter publishers

The Newsletter on Newsletters, January 16, 2004

...The M&A advisory firm Whitestone Communications echoed Mark Young's observations. "While 2003 finished about even with the prior year, the deal picked in the fourth quarter and we see signs of expanded activity for 2004," said Whitestone associate Jenifer Lindenman. "The stock market is running at recent highs and buyers are feeling good about the near-term future of the economy. This means more deals are going to be done," she said.

Lindenman said that signs of this increased interest include:

  • The 2003 fourth quarter had six deals, double the number for the same period in 2002
  • In the U.K., Informa Group announced the largest newsletter acquisition deal in recent years - the purchase of PJB Publications for $210.5 million, at a high multiple of 13.2 times operating profit.

"The price paid for PJB is remarkable when you consider PJB results have been declining for the last few years," Lindenman said. "Also, Informa is taking a big step with this deal in that it is one of the largest, if not the largest, single deal it has ever done. They are clearly confident they can change the direction of the business."

Lindenman concluded, "Despite these signs of life, we still have a long way to go to get back to the heady days of 2000."

This article is reprinted with permission from The Newsletter on Newsletters. Copyright January 16, 2004. www.newsletterbiz.com