UBM Agrees to Buy Advanstar Communications (Owner of IMS Show and J&P Cycle’s Ultimate Builder Custom Bike Show)
By ED BALLARD And RORY GALLIVAN
LONDON—U.K. media company UBM UBM.LN PLC said Wednesday it has agreed to buy Advanstar Communications for $972 million in cash, a major step in UBM’s transition from a diverse media group to an events-focused company.
The addition of Advanstar’s 54 trade shows, which include the Magic Marketplace fashion event, and roughly 100 conferences will make UBM the biggest events business in the U.S. by 2013 revenue, said UBM, which is buying Advanstar from hedge fund Anchorage Capital Group LLC and private equity companies Veronis Suhler Stevenson and Ares Management.
“In addition to being financially attractive, [the acquisition] strengthens UBM’s core events business,” said Chief Executive Officer Tim Cobbold. “Advanstar gives UBM a portfolio of high quality, large scale ‘must-attend’ events which serve growing markets, particularly the U.S. fashion industry, a new vertical for UBM,” he added.
UBM, which used to be best known as a magazine publisher, has undergone sweeping changes in recent years, disposing of titles such as Farmers Guardian and Property Week and other operations to focus on organizing events in varied sectors, including leisure, agriculture and jewelry.
UBM will launch a new financing package to pay for the deal announced Wednesday, comprising a £563 million ($913.7 million) rights issue and a $100 million bridge facility. The rights issue will be launched in November if shareholders approve the acquisition.
Advanstar Chief Executive Officer Joe Loggia will continue to manage the business, UBM said.
Some analysts have speculated that UBM will sell its news release business PR Newswire, which would turn UBM into a company almost fully focused on events.
Mr. Cobbold said in an interview with The Wall Street Journal that he is “pretty relaxed” about UBM’s ownership of PR Newswire, pointing out that it benefits from high margins, but added that he is “open-minded” about the business.