Some big legal publishing news from earlier this week.
Several news outlets reported that ALM, which is best known for publishing American Lawyer, is up for sale for $500 million.
Reuters said that ALM’s owners, the private equity firm Apax Partners, has hired investment bankers to help sell the company.
In the same article, Reuters speculated that the likely buyer would be another private equity firm.
ALM Media generates about $55 million in annual earnings before interest, tax, depreciation and amortization and could fetch about 10 times that amount, said the sources, who requested anonymity because the matter is private.”
As well as American Lawyer, ALM produces more than 30 legal journals, magazines, newspapers, and websites, including Law.Com, Corporate Counsel, the National Law journal, the New York Law Journal, Legal Times, and the Legal Intelligencer.
ALM has had an eventful corporate history.
The American Lawyer, the founding title, was launched by Steven Brill in 1979.
In 1998, the billionaire First Boston investment banker and M&A dealmaker, Bruce Wasserstein, used a private equity vehicle to acquire The American Lawyer, which had earlier been sold by Brill to Time Warner.
Wasserstein set about enlarging the media group and added various legal titles through acquisitions, such as the National Law Journal.
American Lawyer Media formally changed its name to ALM in January 2005.
Wasserstein then secured a good price for ALM after selling to Incisive Media – a UK-based Apax portfolio company – for $630 million in July 2007.
Incisive itself, which publishes more than 100 titles, such as Legal Week, Investment Week, and the leading accountancy title, Accountancy Age, had been acquired by Apax in 2006 – a year before the ALM deal.
But having bought ALM at the top of the market, the post-crisis advertising downturn hit Incisive hard and it breached its lending covenants in 2008 as debt grew to nine times earnings.
As a result, a restructuring followed in 2009 which enabled Apax to take full control of Incisive’s US-based ALM titles and legal journals, while the UK part of the business remained in the control of its lenders, including RBS.
It was recently reported that Incisive is to undergo a further financial restructuring to work down its £100 million debt.
Sky News said that Alchemy Partners acquired a significant amount of Incisive Media’s debts in early 2014.
Elsewhere, M&A activity in the legal publishing world has been pretty high in the last few years.
Some of the other notable deals:
- Thomson Reuters acquired Super Lawyers in 2010
- Bloomberg bought BNA for $1 billion in 2011
- LexisNexis, owned by Reed Elsevier, acquired Law360 in 2012
- Thomson Reuters bought Practical Law Company for £200 to £300 million in January 2013
- Financial Times owner Pearson sold Mergermarket to private equity group BC Partners for $624 million in November 2013
A common theme and driver among many of these deals is the transition from traditional hard copy publishing to the digital world.