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The US private equity group KKR has offered to buy minority shareholders in the German media group Axel Springer in a deal worth 6.7 billion euros to the publisher of the successful newspaper Bild.
The offer, which stands at € 63 per share and is supported by Friede Springer, widow of the founder of the company, and its managing director, Mathias Döpfner, requires the approval of 20% of shareholders remaining, said KKR in a statement. Wednesday.
Mr Döpfner said that escaping the pressures of the public market would allow the company, whose activities also include Die Welt and Business Insider, to make the necessary investments in a company facing a difficult advertising market. The company reminded shareholders of the headwinds on Wednesday by reducing its earnings guidance for the year.
"The strategic partnership with KKR would allow us to pursue major growth opportunities by providing additional financial capacity while avoiding focusing on short-term financial goals," said Mr Döpfner. Mrs Springer and Mr Döpfner together hold 45.4% of the company.
The offer represents a premium of 40% compared to the closing price of Axel, set at € 45.10 per share on May 29, when news of the potential transaction was announced. However, it is well below the peak of € 73 last year. Springer shares jumped 12% early in the session.
Revenues and adjusted net income would decrease in 2019, added Springer. The group had already forecast higher revenues and stable results for the year.
Analysts said investor discomfort over potential acquisitions and additional investments was one of the main reasons for the deal with KKR. Among the other targets, Springer plans to buy eBay's clbadifieds business, valued at around $ 10 billion.
The deal comes at a time when private equity groups are looking for acquisitions after raising their largest funds at record speeds. KKR has been active in Germany, where it has invested more than $ 5 billion in equity in around 20 companies over the past two decades. More recently, the US buyout group has partnered with a major shareholder to acquire the GFK Market Research Company, a transaction similar to the Springer transaction.
Before agreeing to negotiate a contract with KKR, Mr Döpfner – who has been the engine of the offer – has initiated a screening process of a number of capital companies -investment interested in such a transaction, said a close to the offer.
"Building lasting and trusted relationships with companies around the world is at the heart of what we do at KKR," said Johannes Huth, KKR's European Head. "We are excited to join Axel Springer in his future journey."
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