Italy’s largest business newspaper, Il Sole 24 Ore, will file an application to list its shares in the next two weeks, in an effort to tap the growing investor appetite for business media stocks.
A source close to Il Sole 24 Ore, which is wholly owned by Confindustria, Italy’s main business lobby group, said the company was aiming to make its market debut in November, putting a 32.5 per cent stake on the block.
Il Sole 24 Ore is widely regarded in Italy as the business paper of record, and is among Europe’s largest business papers, with a daily circulation of 347,000 copies and an estimated 1.2m readers. Although it has seen little recent growth in circulation, it has boosted advertising revenues.
The company was expected to announce a 27 per cent rise in gross profits (earnings before interest, tax, depreciation and amortisation) for the first half of the year at a board meeting Monday night. Ebitda for the first half of 2007 was €56m ($71.5m) on total revenues of €307m, versus an ebitda of €44m on revenues of €274m last year.
Il Sole’s flotation plans come as valuations of financial newspaper assets have been rising, sparked by acquisition interest and healthier conditions than those seen elsewhere among print media. Rupert Murdoch’s News Corp offered $5bn – a valuation equivalent to 40 times this year’s earnings – to secure control of Dow Jones, publisher of the Wall Street Journal.
Pearson, the publisher of the Financial Times, is negotiating the sale of Les Echos, its French business daily, to LVMH, Bernard Arnault’s luxury group. The €240m sale price was at the top end of the range of analysts’ expectations. It produced operating profits of €10m last year on sales of €126m.
Buyers have been drawn both by the perceived trophy value of such brands and by the relative resilience of advertising and subscription revenues in titles for a specialist, upmarket readership, both in print and online.
In a recent CNBC interview, Mr Murdoch highlighted wsj.com’s large subscriber base, saying: “The value of financial journalism – high-quality financial journalism – is that you can charge for it.”
But analysts believe sustained turmoil in credit, equity and currency markets could weigh on circulation and advertising revenues.
Il Sole, led by chairman Giancarlo Cerutti and chief executive Claudio Calabi, plans to use the capital for national and international expansion.
Global co-ordinators will be Mediobanca and UBS. Retail placing will be handled by Intesa Sanpaolo, Unicredit and BNP Paribas. The book runners for institutional investors will be Goldman Sachs, Citigroup, Lehman Brothers and Merrill Lynch.