UBM sells PR Newswire to Cision for $841 mn
16 December 2015
Leading British business events organiser UBM Plc has agreed to sell its well-accepted news-release distribution agency PR Newswire to US media intelligence company Cision for approximately $841 million in cash and preferred equity.
News about possible sale of New York-based PR Newswire surfaced in September, when UBM disclosed that it was engaged in ''highly preliminary discussions'' with several parties to strike a deal.
Under the terms of the deal, UBM would get $810 million in cash and $21 million in preferred equity.
PR Newswire is a distributor of news releases and other marketing information for companies primarily in the US and Canada. Last year, PR Newswire reported revenue of about $297 million, half of which comes from the US.
Warren Buffet's Business Wire is the main competitor for PR Newswire in the field.
''Today's announcement represents a significant step in the execution of UBM's 'Events First' strategy, the objective of which is to become the world's leading focused B2B events business,'' Tim Cobbold, the UBM chief executive, said in a news release.''
In a separate release, PR Newswire CEO Robert Gray said the combination with Cision would create a global communications platform of content monitoring, creative services, multichannel distribution and analytics among other related services.
The buyer, Chicago-based Cision, is owned by leading private equity firm GTCR Canyon Holdings LP. It is a leading global media intelligence company, serving communications, social media and content marketing professionals. It businesses include Gorkana Group, PR Web and IContact.
''We are serious about building a comprehensive platform to help our clients manage the entire life cycle of communications - from influencer discovery and content distribution to engagement and campaign analysis,'' Peter Granat, CEO, Cision, said.
The transaction is expected to close by the end of 2016, subject to shareholders' as well as regulatory approvals.
Cision intends to fund the deal through debt from Deutsche Bank, Barclays and RBC Capital Markets.
Net proceeds of approximately £498 million ($750 million) will be used to pay a special dividend of about £245 million to UBM shareholders and the balance £253 million will be used for strategic acquisitions in the event field, the company said.
London-based UBM is primarily focused on business events like trade shows etc. A year ago, the company acquired California-based Advanstar for $972 million to boost its offerings in the event sector.
A long-term product roadmap and timeline will be finalised following completion of the transaction, and both companies are intent on ensuring there is no disruption to current services as we work to create an enhanced set of integrated offerings to better serve journalists' needs, according to PR Newswire.
JP Morgan Chase and Evercore acted as advisors to UBM on the transaction.