RSSWho is Buying the Ziff Davis Enterprise Group? NY-Based PE, That’s Who
A friend today clued me into who is in the hunt for the Ziff Davis enterprise group (Baseline, CIO Insight, eWeek, and related Web sites, shows, etc). The buyer is a New York City-based private equity firm called Insight Venture Partners. IVP is primarily invested in four different industry sectors: application software, infrastructure software, Internet and new media, and software-enabled services. My source tells me that the deal is all but signed and that people close to the deal are surprised that it hasn’t happened yet–but are assured that it will.
IVP’s expertise in the industry comes from its investments in Internet and new media, such as Airborne Entertainment (former portfolio company–provider and distributor of mobile content), DivX (creator and distributor of digital video technology), and–I love that this exists–Greenfield Online* (online survey vendor); and many others.
How much they will pay, what they will do with the company, why they’re buying it, and why it’s taking so long–these are all things I do not know. You’ll have to ask your friends at Evercore Partners (the I-bank that is handling the deal for Ziff Davis), or your friends at ZD. Seriously, ask them, and then tell me what they said.
Oh, one last thing. Another source mentioned to me that he heard a rumor that IVP will be putting 6x leverage on the business through staple financing, which is financing arranged by the seller to give the new buyer an already built-in loan.
Stay tuned for updates.
* I always wanted something named after me, but I hoped that it would be a small star, or even just a tiny planet, or some space dust–something cosmic. But I’ll settle for this.
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I hear this deal is coming July 2 or so. I have one question. Your blog entry mentions 6X leverage. Is that 6X ZD enterprise’s annual revenue? 6X the buying price? 6X annual EBIDTA? Any idea?
Thanks for the tip on the drop date.
I should have been more specific: my source said 6x trailing 12 months EBITDA. It’s worth noting that this multiple will increase if the buyers add additional financing, which is common with staple financing.
So is it correct to say that Willis Stein (ZIff Davis Enterprise’s current owner) is lending Insight Venture Partners money to acquire ZD enterprise? Or am I misunderstanding the rumored financial arrangement?
That would be correct–if it does indeed turn out to be true.
I was mistaken. The loan is arranged by the seller, ie, Willis Stein, but provided by the lender. I apologize for the error.