Publishing Bidding Won by Yell Group
News: A process
that began a little over a month ago when Forstmann Little put an offer
on the table to buy McLeodUSA Publishing has ended with Yell Group winning
a competitive bidding process. The U.K.-based Yell will pay $600 million
for McLeod, twice its estimated 2001 revenues and 10.3 times the earnings
before interest, taxes, depreciation and amortization (EBITDA) estimate
By adding McLeod's
267 directory titles in 21 states (January 2002 Rates & Data), the Yell
Group will have directories in 40 states. In six states, McLeod and Yellow
Book both have directories, but they overlap in only two markets. "This
is a simple fit. Both the management teams and the market areas are complementary,"
John Condron, chief executive officer of Yell and the driving force behind
the acquisition, told The Kelsey Group (TKG).
Yell's principal shareholders
are funds advised by Apax Partners and Hicks, Muse, Tate & Furst. The
company includes the U.K. Yellow Pages and Business Pages directories,
Yellow Book directories in the U.S., Yell.com and Talking Pages. Terms
of the definitive agreement are substantially the same as in the previous
agreement with Forstmann Little, which had originally bid $535 million.
McLeodUSA Inc. will retain its brand for a minimum of five years on directories
published in the 25 states in which it operates various communications