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KKR launches tender offer for majority Axel Springer stake
Posted on Thursday, 13 June 2019 08:28
KKR is looking to take control of one of Europe’s leading publishers by buying out minority shareholders in a deal that values Axel Springer at EUR 6.80 billion.
The private equity investor has announced its plan to launch a public tender offer for the shares at EUR 63.00 apiece, representing a 39.7 per cent premium to the potential target’s close of EUR 45.10 on 29th May 2019, the last close prior to the company confirming it was in talks with the buyout firm.
KKR said it will support Axel Springer, the owner of the Business Insider and Bild, alongside Friede Springer and Mathias Döpfner, who together hold a 45.4 per cent interest.
Both of these shareholders have agreed to form a consortium with the buyer subject to the closing of the tender offer.
KKR will fund the acquisition primarily from its European Fund, with JPMorgan as an advisor and Unicredit providing financing.
Closing is subject to regulatory approvals and a minimum offer acceptance of 20.0 per cent of Axel Springer’s share capital.
The target also issued a statement on the deal, saying the investment by KKR is the result of its strategic review and a partnership will support the long-term growth of the company.
Axel Springer believes that the buyer’s expertise in the digital and media sectors in Europe will allow the company to invest in projects that will generate future value.
The group has operations in more than 40 countries and has been transforming its business from traditional print to a digital publisher for a number of years; it is now billed as one of the leading providers in Europe.
Axel Springer’s next goal is to become the number one in online content and classifieds globally through accelerated growth.
The business outlined that 71.0 per cent of revenues and 84.0 per cent of total adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) came from digital activities in fiscal 2018.
Turnover totalled EUR 771.80 million in the three months ended 31st March 2019, representing a slight decrease on EUR 773.50 million in the corresponding period of 2018.
Axel Springer recorded a 2.5 per cent decline in adjusted EBITDA to EUR 167.00 million in Q1 2019 (Q1 2018: EUR 171.20 million).
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