The world’s richest man buys 3.2 pct stake in Spain’s Prisa

November 19, 2011 — Fusion DigiNet

Carlos Slim, the world’s richest man, has bought a 3.2 percent stake in Promotora de Informaciones SA (Prisa), Spain’s largest media company whose shares have slumped by about 50 percent this year.

The purchase of 14.7 million shares of Prisa was made through Slim’s investment arm Inmobiliaria Carso SA, according to an exchange filing made in Spain on Friday. The statement did not specify how much Slim paid.

Based on the price of Prisa shares at Thursday’s close, the stake would have been worth 11 million euros. The shares jumped 12 percent on Friday to 0.84 euros, helped by the news of Slim’s investment.

Prisa’s business spans radio and TV assets in Spain and Latin America, as well as Spain’s best-selling newspaper El Pais. The company is trying to shed assets and cut its debt after borrowings topped 4 billion euros in 2010.

Slim is the chairman and chief executive of telecommunications companies Telmex and América Móvil and has extensive holdings in other Mexican companies. As of early October, Slim held 8.1 percent of Class A shares of New York Times.

Mexico, Mexico City & Spain, Madrid

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The Walt Disney Company acquires online parenting platform Babble Media

November 19, 2011 — Fusion DigiNet

The Walt Disney Company, through its wholly owned subsidiary Disney Online, has acquired Babble Media, an online parenting platform featuring more than 200 influential “mom bloggers”. The acquisition of Babble further strengthens the position of Disney Interactive Media Group’s Mothers and Family portfolio as a leading online resource for mothers and families. Terms of the deal were not disclosed.

Babble was founded in 2006. Its stable of bloggers contribute daily to parenting topics including pregnancy, child care, health, food, family activities as well as lifestyle topics such as home, fashion and family products. Babble attracts a broad and engaged audience with its nearly constant stream of posts, written for and by mothers.

“Parents’ relationships with Disney are founded in stories, and Disney’s best stories are about families. We believe that Babble and Disney can harness the power of storytelling to inform, entertain and empower parents everywhere,” said Brooke Chaffin, SVP of Moms and Family, Disney Interactive Media Group. “With more than 3.9 million mom blogs in the US alone, Disney Interactive recognises and values the important and powerful role moms have taken on in new media.”

Babble will remain headquartered in New York. Rufus Griscom and Alisa Volkman will join the Disney Interactive Media Group.

USA, Burbank, CA

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Moody’s Corporation acquires majority stake in Copal Partners

November 19, 2011 — Fusion DigiNet

Moody’s Corporation has acquired a majority stake in the companies of Copal Partners. Copal’s companies are among the world’s leading providers of outsourced research and analytical services to institutional customers. The terms of the transaction were not disclosed.

Copal’s analytical resources support front-line professionals at financial institutions and corporate enterprises worldwide. With expertise in a wide range of disciplines, including financial modeling, industry and company research, capital structure analysis and market surveys, Copal deploys a flexible staffing model to meet the specific requirements of its customers.

“Copal is highly regarded in the global financial services industry as a leader in high quality research and analytical services for bankers, financial analysts and institutional investors,” said Mark Almeida, President of Moody’s Analytics. “This acquisition extends Moody’s Analytics’ capabilities, enabling us to better help financial institutions manage risk. In addition, Copal’s expertise and resources will allow us to accelerate innovation across Moody’s Analytics.”

The acquisitions do not alter Moody’s 2011 earnings per share (EPS) guidance, and are expected to be accretive to Moody’s EPS in 2012. Moody’s funded the purchases from cash on hand.

Moody’s was advised on the transaction by Citi and Slaughter and May. Copal Partners was advised by Centerview Partners and Macquarie Capital. Proskauer Rose served as legal advisors for Copal.

USA, New York, NY

 

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Vivendi and Universal Music Group to acquire EMI Music

November 19, 2011 — Fusion DigiNet

Vivendi and its subsidiary, Universal Music Group have agreed to purchase EMI’s recorded music division from Citigroup for a total consideration of £1.2 billion representing 7 x EBITDA prior to synergies.

EMI Group is one of the world’s most prominent music companies. Its recorded music division, EMI Music, operates around the world and represents artists spanning all musical tastes and genres through record labels including Angel, Astralwerks, Blue Note, Capitol, Capitol Latin, Capitol Records Nashville, EMI Classics, EMI CMG, EMI Records, EMI Records Nashville, Manhattan, Parlophone, Virgin Classics and Virgin Records.

Jean-Bernard Lévy, CEO of Vivendi, stated: “We are very proud to welcome EMI into the Vivendi family. We all respect the labels within EMI as well as the artists and employees who contribute to its success. They will find within our Group a safe, long-term home, headquartered in Europe.” He then added: “We plan to acquire EMI’s recorded music division on attractive terms, adhering to our principle of total financial discipline. We are confident that we will be able to create additional value for our shareholders thanks to our knowledge of the industry and our proven track record of successful integration. Lucian Grainge’s personal experience and heritage will be a major asset in making the combined entity a great success.”

Lucian Grainge, Chairman & CEO of Universal Music Group, added: “This is a historic acquisition for UMG and an important step in preserving the legacy of EMI Music. For me, as an Englishman, EMI was the preeminent music company that I grew up with. Its artists and their music provided the soundtrack to my teenage years. Therefore, UMG is committed to both preserving EMI’s cultural heritage and artistic diversity and also investing in its artists and people to grow the company’s assets for the future. As a result, we will be better positioned to fully capitalise on the many new and exciting opportunities in the current marketplace, and also able to better serve our artists, songwriters and business partners, while offering fans even more choice.”

Vivendi will finance the transaction from its existing credit lines. Concurrently, Vivendi and UMG will also sell 500 million euros worth of non-core UMG assets.

Vivendi and UMG have been advised by Allen & Co. and SJ Berwin on this transaction. Citi Global Banking acted as financial advisor to Citi and EMI. Clifford Chance LLP, Shearman & Sterling LLP and Freshfields Bruckhaus Deringer LLP acted as legal advisors to Citi and EMI.

UK, London & France, Paris & USA, New York, NY

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RLJ Equity Partners acquires Media Source

November 9, 2011 — Fusion DigiNet

RLJ Equity Partners has acquired Media Source, the parent company of three businesses that promote and sell children’s books and a variety of services and products geared toward the library industry, including book collection development, magazine subscriptions, book reviews, websites, webinars, and conferences. RLJ Equity Partners, LLC was joined by 21st Century Group, LLC and New Canaan Funding Mezzanine, LLC in the transaction.

“We believe MSI is a very important company in terms of its contributions to improving library systems and public school systems,” said Robert L. Johnson, founder of The RLJ Companies and chairman of RLJ Equity Partners. “We are pleased to own a company that is a trusted resource for librarians and school systems across the country and look forward to expanding in metropolitan markets domestically and internationally,” he concluded.

Media Source is the leading provider of information content and editorial book reviews for academic, public, and school librarians serving tens of thousands of libraries and more than 100,000 librarians. MSI’s Junior Library Guild division reviews thousands of new children’s books each year and selects the best titles in more than 40 different categories. Its School Library Journal, Library Journal, and Horn Book divisions provide critical information and reviews to the library market via digital and print media products.

USA, Bethesda, MD

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The E.W. Scripps Company third quarter results

November 9, 2011 — Fusion DigiNet

Consolidated revenues from continuing operations were $168 million, a decrease of 8.6 percent from $184 million in the third quarter of 2010.

Operating expenses totalled $165 million, down 4.9 percent from the second quarter, and down 2.3 percent compared with the year-ago quarter. Restructuring costs, largely for the ongoing efforts to standardise and centralise certain functions that should benefit the newspaper division starting in 2012, were $2.6 million.

The third quarter results include a non-cash charge for the impairment of long-lived assets at four of the company’s newspapers. The company concluded that the fair value of certain of its newspapers was less than the carrying value of its net assets. Scripps recorded in the third quarter a $9 million, pre-tax, non-cash charge to reduce the carrying value of property and equipment.

Largely due to the impairment charge, the company reported an $18.2 million loss from continuing operations before income taxes, compared with what was essentially a break-even quarter a year ago.

The loss from continuing operations, net of tax, was $10.7 million, or 19 cents per share in the 2011 quarter, compared with income from continuing operations, net of tax, of $5.4 million, or 8 cents per share, in the year-ago quarter. Excluding the effect of the impairment charge, the loss from continuing operations, net of tax, would have been 9 cents per share in the most-recent quarter.

The tax provisions in the third quarter of both 2011 and 2010 include the impact of favourable settlements of the examinations of prior-year tax returns.

“We continue to reshape Scripps, improving the company’s short-term and long-term opportunities for growth,” said Rich Boehne, Scripps president and CEO. “We believe local TV stations are both good businesses today and attractive launching pads for the future, which is why during the quarter we agreed to purchase the nine stations now owned by McGraw-Hill Broadcasting. At a purchase price of $212 million, we should show a strong return on investment and gain access to TV and digital media consumers and advertisers in Indianapolis, Denver and San Diego. Plus we picked up a great small-market station in Bakersfield, Calif., and access to the developing Spanish-language market through five Azteca stations in Colorado and California. We’re eager to close the deal and bring these businesses into the Scripps fold.

USA, Cincinnati, OH

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Demand Media reports third quarter 2011 financial results

November 9, 2011 — Fusion DigiNet

Content and social media company Demand Media has reported financial results for the quarter ended September 30, 2011.

Financial Summary

GAAP

  • Revenue increased 25% to $81.5 million, compared with $65.4 million in Q310.
  • Loss from operations of $(3.3) million compared with income from operations of $0.9 million in Q310.
  • Net loss of $(4.1) million compared with a net loss of $(0.3) million in Q310. Net loss per share of $(0.05) compared with $(0.64) in Q310.
  • Cash flow from operations grew 36% to $22.1 million, from $16.3 million in Q310.

Non-GAAP (see the full statement Non-GAAP measures)

  • Revenue ex-TAC increased 26% to $78.1 million, from $62.2 million in Q310.
  • Adjusted OIBDA grew 33% to $21.7 million, or 27.7% of Revenue ex-TAC, compared with $16.3 million, or 26.2% of Revenue ex-TAC, in Q310.
  • Adjusted Net Income of $5.0 million increased 12% compared with $4.5 million in Q310. Adjusted Net Income per share – diluted of $0.06, grew 20% compared with $0.05 in Q310.
  • Discretionary Free Cash Flow increased 116% to $19.9 million compared with $9.2 million in Q310.
  • Free Cash Flow of $6.0 million compared with $(4.0) million in Q310.

“We reported another strong quarter as we continue to build Demand Media’s foundation for long-term growth,” said Richard Rosenblatt, Chairman and CEO of Demand Media. “The Company is uniquely positioned to deliver data-driven professional content through its robust content publishing platform. We are now in the process of optimizing that platform while increasing our investment in video content and enhancing the quality, engagement and user experience of our sites.”

  • Content & Media Revenue increased 27% to $50.7 million, compared with $39.8 million in Q310.
  • Traffic acquisition costs (TAC), which represent the portion of Content & Media revenue shared with Demand Media partners, of $3.4 million, or 6.7% of Content & Media revenue, compared with $3.2 million, or 7.9% of Content & Media revenue, in Q310.
  • Content & Media Revenue ex-TAC grew 29% to $47.4 million, from $36.7 million in Q310.
  • Registrar Revenue increased 20% to $30.7 million compared with $25.5 million in Q310.
  • Investment in Intangible Assets of $13.9 million increased 5% from $13.3 million in Q310.
Read the full statement here
USA, Santa Monica, CA
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Yell’s half year interim results

November 9, 2011 — Fusion DigiNet

Revenue in line with expectations

  • Print directories – deteriorating trend continues – down 20.1%
  • Digital directories – deteriorating trend continues – down 12.3%
  • Strong growth in digital services – up by 136.5%
  • Underlying growth – down 13.3%
  • A £100m debt buy-back is being considered.
  • The company built up a debt pile after a series of acquisitions which included its Spanish directories business. The company has no plans to sell existing businesses.

FY12 Outlook

  • EBITDA within current market expectations
  • Full year exceptional – reorganisation costs of circa £25m
  • Not expecting covenant breach within FY12
See the full presentation here
UK, Berkshire

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Rakuten to Acquire Kobo US$315 million in cash

November 9, 2011 — Fusion DigiNet

Rakuten is to acquire Kobo for US$315 million in cash. The transaction is expected to close in Q1 2012.

Kobo was founded by and spun out of Indigo, the largest book, gift and specialty toy retailer in Canada, in December, 2009. Since that time, Kobo has become a fierce competitor in the eBook marketplace, with a family of innovative eReaders, a wide range of eReading apps, one of the largest eBook catalogues, an innovative social platform and retail partners around the globe.

The acquisition marks a major step forward for Rakuten, one of the world’s top 3 e-commerce companies by revenue, as it continues to expand its B2B2C borderless e-commerce business globally, by adding an ecosystem to provide downloadable media products to consumers, starting with eBooks.

Hiroshi Mikitani, Chairman and CEO of Rakuten, commented on the acquisition, “We are very excited about this next step. Kobo provides one of the world’s most communal eBook reading experiences with its innovative integration of social media, such as Facebook and Twitter; while Rakuten offers Kobo unparalleled opportunities to extend its reach through some of the world’s largest regional e-commerce companies.

Upon closing the acquisition, Kobo will continue to maintain its headquarters, management team and employees based in Toronto, Ontario.

Japan, Tokyo & Canada, Toronto

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HarperCollins Publishers to acquire Thomas Nelson

November 2, 2011 — Fusion DigiNet

HarperCollins Publishers has entered into a definitive agreement to acquire Thomas Nelson. for an undisclosed sum. The acquisition is expected to close by the end of the calendar year.

Thomas Nelson is one of the leading trade publishers in the United States. The Company provides multiple forms of inspirational content including: books, Bibles, e-books, journals, audio, video, curriculum and digital applications available for download on “smart” electronic devices. It has published some of the bestselling books in the industry, including the current #1 bestseller Heaven Is For Real, and the books of many popular authors, such as Billy Graham, Max Lucado, and Dave Ramsey.

“Founded in 1798 in Edinburgh, Scotland, Thomas Nelson shares a long and rich heritage with both New York’s Harper Brothers and Scotland’s William Collins & Sons. It is thus with great pleasure that I look forward to welcoming Thomas Nelson to the HarperCollins family,” said Brian Murray, President and CEO of HarperCollins Publishers Worldwide. “HarperCollins’ global print and digital publishing platform, which includes e-book distribution into more than 175 markets, Print-on-Demand, Digital-to-Print at Retail, and worldwide marketing reach, provides an opportunity to further expand the readership of Thomas Nelson’s distinguished authors.”

“Additionally, Thomas Nelson adds further balance to our existing publishing programs. Its broad inspirational appeal is a good complement to Zondervan, which will continue to publish books consistent with its mission,” added Murray.

“We are excited to be joining HarperCollins Publishers,” said Mark Schoenwald, President and CEO of Thomas Nelson. “We believe this transaction represents an attractive strategic fit for our company. With HarperCollins’ resources and capabilities to draw on, we will capitalize on the many opportunities in this rapidly changing world of publishing.”

USA, New York, NY

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