Macquarie Regional RadioWorks’ parent company, Macquarie Media Group has bought two American regional newspaper companies through its US subsidiary, American
Consolidated Media. The company has agreed to acquire, in separate transactions, 22
publishing assets of Chesapeake Publishing Corp (Chesapeake) and 11 publications from
the Brown Publishing Company (Brown).
The acquisitions have a combined enterprise value of A$182m (US$159.5 million),
representing an EV/EBITDA3 multiple of 10.3x based on the current year’s EBITDA of A$17.7
million. Subject to closing
conditions it is expected that the acquisition of the Brown publications will be completed in
early December 2007 with Chesapeake to complete by early January 2008.
Both companies are “the primary source of local news and information in their markets generating
stable cash flows from a diverse base of local advertisers. Both businesses have minimal
reliance on national advertising and enjoy strong free cash flow due to limited capital
expenditure requirements and strong margins.”
Further growth is expected to come through efficiency improvements from their consolidation into the ACM platform and underlying
population, personal income and retail sales growth in their regions.