After 22 yrs, Euromoney seeks a buyer for Institutional Investor

Euromoney Institutional Investor’s sale of its asset management businesses has kicked into gear.

Euromoney put Institutional Investor, along with two research companies, up for sale, two sources said. Goldman Sachs is advising on the process, the sources said.

The businesses produce $75 million Ebitda on $275 million in revenue, one of the sources said. They are expected to sell at 10x to 12x Ebitda, one of the sources said.

The auction has yet to begin. It is expected to draw the attention of large buyout shops like KKR or Blackstone Group, the source said.

Euromoney Institutional Investor, which is transitioning to a 3.0 B2B business information services model, said earlier this month it was conducting a strategic review of its asset management business. This consists of BCA Research, Ned Davis Research and Institutional Investor.

The review comes as Euromoney’s asset management business has come under pressure due to the growth of passive asset management and Markets in Financial Instruments Directive (MiFID) II, according to a report from Edison Investment Research. MiFID II is a European Union law that was introduced in January 2018. It requires asset managers to pay for research separately from execution services, FT Advisor said.

“A sale is not necessarily the only outcome of the review and, if that is the route chosen, management has a record of strong discipline in M&A pricing,” Edison said in a note about the Euromoney strategic review.

Euromoney, of London, is a publicly traded business-to-business information provider and events organizer. Its investment in Institutional Investor dates to August 1997 when it paid $142 million for the company, according to press reports.

Founded in 1967, Institutional Investor is a B2B publisher that focuses mainly on international finance. The New York company publishes newsletters and research; it is known for the Institutional Investor magazine.

Euromoney acquired a majority stake of Ned David Research in 2011 for about $112 million, press reports said. Ned David provides financial research to institutional investors. In 2006, Euromoney bought BCA Research, of Montreal, which supplies investment research and investment strategy advice.

More recently, Euromoney Institutional Investor paid $87.3 million for the institutional units of TheStreet. This included The Deal and BoardEx. It’s unclear if those units are part of the transaction.

The media sector has seen activity recently. PEI Media, which is backed by Bridgepoint, acquired Buyouts Insider in April. (Buyouts Insider is the publisher of PE HUB.) Meredith in 2018 sold Time magazine to Marc Benioff and his wife Lynne Benioff for $190 million, NPR said. In May, Meredith sold Sports Illustrated to Authentic Brands for $110 million.

Euromoney declined comment. Executives for Goldman, Institutional Investor, Ned David and BCA could not be reached for comment.

Action Item: See Euromoney’s 2018 annual report here.