Web-based business publisher Australian Independent Business Media remains firmly on the market after it rejected a low-ball takeover offer from Fairfax Media.
Crikey understands a number of other parties, including News Limited, remain actively involved in the $30 million play for the business news suite that boasts popular news website Business Spectator and investment advice e-zine Eureka Report.
This morning, an item appeared in the Fairfax-owned Australian Financial Review‘s Street Talk section stating the catalyst for the breakdown was that Fairfax “did not agree with AIBM’s $30 million valuation process”. But Crikey understands it was in fact AIBM that pulled the pin after Fairfax came back with an unsatisfactory second offer when the firm’s books were examined in a private data room during due diligence.
AIBM chairman Alan Kohler told Crikey this morning he was “certainly not short of suitors” for his suite of sites and that he had been “negotiating actively for ages”.
Kohler said one bidder in particular — that Crikey separately understands to be News Ltd — was still pursuing the company and that three other parties were also nipping at AIBM’s heels on the sidelines.
News Ltd spokesman Stephen Browning said today his company has a policy of not commenting on internal M&A activity.
Speculation about an impending sale of AIBM has been swirling ever since Crikey reported Fairfax CEO Greg Hywood’s interest shortly before Christmas. Kohler confirmed Fairfax contacted him, rather than the other way around: “The whole process started when we were approached by Fairfax.”
The ABC presenter and former Fairfax editor, who told The Australian in February that the sale process was “driving him f-cking crazy”, declined to be drawn on when a fresh deal might be minted.
Crikey reported the details of the defunct Fairfax offer a month ago. Under the planned 75% buy out, three major shareholders — Mark Carnegie, John Wylie and Private Media chairman Eric Beecher — would have sold their stakes to the media giant, with the fourth major shareholder, Kohler, becoming CEO of the merged entity that would logically sit inside Fairfax’s Financial Review Group.
According to a leaked memorandum obtained by Crikey in January, AIBM generated total revenue of $8.84 million last year – $3.64 million drawn from the Spectator Group and $5.19 million from Eureka Report.
The Spectator Group posted a $1.67 million loss while Eureka Report — which thrives off 16,000 subscribers paying up to $385 a year for investment and superannuation advice — chalked up a $1.91 million profit. The combined sites made $237,000, down from $541,000 in 2009-10, due to an IT upgrade and staff wages.
About 55% of total revenue was drawn from Eureka, a third from Business Spectator ads and the remainder from sister sites Climate Spectator and Technology Spectator.
AIBM suffered a personnel blow recently after the departures of Eureka Report senior journalist Michael Feller and experienced Eureka sub-editor Jamie Harrison. However, Eureka recently hired rapid-fire ex-ICAP economist Adam Carr to fill Feller’s shoes.
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