Reed to offer higher vendor loan to ensure RBI sale

LONDON - Reed Elsevier is willing to increase its proposed loan package for the eventual buyer of its business-to-business division Reed Business Information to ensure a deal goes through, according to reports.

The sale is being partly funded with $330m (£211m) of vendor financing from Reed's own balance sheet, but the Anglo-Dutch media giant is prepared to offer more than this to overcome the current market situation and seal a deal, according to The Daily Telegraph.

Reed has also sought a pre-arranged staple package of $1.26bn (£803m) from a consortium of seven banks, led by UBS, to finance the deal. 

The media group placed its RBI unit, which includes magazine titles such as Computer Weekly, Farmers Weekly and New Scientist, up for sale in February of this year. 

Second-round bids were made last month, but a date for the next round of bidding is unknown. 

The initial sale price was listed at up to £1.25bn but it emerged last week that bidders were intending to reduce their offers to below £1bn, owing to the downturn. 

The bidders, which include Bain Capital, TPG and former Reed non-executive director, Strauss Zelnick, are believed to be concerned about possible deterioration in trading at RBI. 

Hamburg-based publisher Gruner + Jahr, majority-owned by German media group Bertelsmann, reportedly pulled out of the bidding contest in September.

Become a member of Campaign from just £51 a quarter

Get the very latest news and insight from Campaign with unrestricted access to campaignlive.co.uk ,plus get exclusive discounts to Campaign events

Become a member

Looking for a new job?

Get the latest creative jobs in advertising, media, marketing and digital delivered directly to your inbox each day.

Create an alert now

Partner content