Guardian Media Group Plc (GMG) has postponed discussions with suitors concerning the divestment of its 50.1% stake in UK publisher Trader Media Group Limited (TMG), the owner of the Auto Trader brand, after failing to agree a price, the Financial Times reported citing two sources.
GMG’s joint venture partner in TMG, UK private equity firm Apax Partners Holdings Ltd, sought to buy out the stake via a deal that valued the group at some GBP1.2bn (USD1.9bn/EUR1.4bn), including net debt of GBP600m. The price was significantly lower than the expected one, the sources said. GMG has also ended talks with other private equity investors, including Hellman & Friedman LLC and Kohlberg Kravis Roberts & Co LP (NYSE:KKR).
GMG, the publisher of UK’s Guardian and Observer newspapers, and Apax have the right under an agreement to buy each other out of TMG if any of them makes a decision to exit the publishing company. According to bankers’ estimates, TMG is worth up to GBP2bn.
It is believed that Apax, which bought a 49.9% stake in TMG in 2007, is not in a hurry to ink a deal as it wants to negotiate a better price.
GMG and Apax refused to make a comment.