GMG shelves Trader Media Group deal

Greg Gille
@unquotenews
24 January 2013

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Guardian Media Group (GMG) has ended talks to sell its stake in car classifieds business Trader Media Group (TMG) – a deal that could have seen Apax Partners take full control of the company – according to reports.

Apax currently owns 49.9% of TMG; the deal would have seen it acquire the remaining 50.1%. GMG is understood to have ended talks as offers were deemed too low. TMG could be valued at up to £2bn, according to media reports. Apax's offer would have reportedly valued it at £1.2bn.

GMG is also believed to have approached other private equity houses, including Hellman & Friedman, although this avenue did not yield satisfactory results either.

Apax acquired its stake in TMG from GMG for around £675m in 2007. The transaction valued TMG at £1.35bn and GMG retained a 50.1% stake in the business. GMG announced in 2006 that it had decided to rebalance the group's portfolio through the sale of a minority stake in TMG. The deal was financed by a covenant-lite financing package arranged by JP Morgan.

Apax was also one of the few private equity investors able to perform a dividend recap in 2011: the GP and GMG shared a £280m dividend when they refinanced TMG, bringing the group's net debt ratio to around 4-5x EBITDA.

TMG is a classified directories business operating from both print and online platforms. The company posted a £257m turnover and £142.9m EBITDA in the year ending in April 2012.

Apax was not available to comment.