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Acquisition Strategy
Since 1995, Target Media's management team has completed more than 35 acquisitions of advertising publications, and we are actively seeking additional acquisitions of classified, car photo and other specialty advertising publications. We are interested in both paid and free circulation publications, and we will consider any size transaction in any niche or geographic market. We have been quite successful acquiring and growing mature publications with proven records of profitability and dominant market shares, and we also seek new, rapidly growing publications in attractive markets.
In 2005, we acquired Phoenix Auto Guide a full-color, vehicle photo and dealer display publication; Auto Finder, a vehicle dealer display publication based in Albany, New York; and Car & Truck Buyers Guide, which publishes three weekly free circulation used car photo publications covering Miami/Dade County, Ft. Lauderdale/Broward County and the Palm Beach/Treasure Coast areas in south Florida. In 2006, we acquired 60% of Pre-Owned, a used car dealer magazine serving the Houston metropolitan market, and in our largest acquisition to date, we purchased 19 publications in eastern Washington from Lee Enterprises. These publications include Nickel Nik, a 51-year old classified ad publication in Spokane, and three editions of flagship Wheel Deals, which contain more than 300 pages of vehicle advertising every week. Well-trafficked websites, including www.nickelnik.com, www.wheeldeals.com and www.ewnickels.com are attractive components of this acquisition.
We keep our acquisition pipeline full through systematic cultivation of opportunities. Our acquisitions effort is led by Jack Humphreville, who maintains close contact with corporate and entrepreneurial owners of advertising publications, as well as with investment bankers and brokers of media properties. We encourage our 700 employees to keep their eyes open for interesting publications, and some of our best acquisitions have resulted from leads from employees.
Our acquisition process is friendly and honest. We are willing to be patient with potential sellers, but we also are willing to move extremely rapidly if a seller desires speed. We can easily evaluate whether we are interested in a particular publication; our hands-on due diligence is straightforward; our legal contracts are simple; and our approval process is quick. We have acquisition funding in place--internally generated cash flow and a substantial credit facility with a group of banks led by Wells Fargo. We are disciplined about purchase prices, and we strive to lower our effective purchase multiples over time by increasing the revenues and improving the profit margins of the businesses we acquire.
Former owners of businesses we have bought serve as references for potential sellers. In addition, we encourage sellers to retain minority ownership stakes to participate in the future upsides of their businesses and provide for continuity of management.
Potential sellers and brokers are encouraged to contact Jack Humphreville by email
at jack@targetmediapartners.com
or by phone at (323) 930-3123 x31103.
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