Numis gambles on Centaur flotation

Emap, United Business Media, Incisive Media and HG Capital bid far less than Numis, the stockbroker which won the race to buy Centaur Communications, sources said this week.

Numis is believed to have made an offer of around £140m for the group, which owns The Lawyer, Design Week and Marketing Week, and plans to float Centaur on the stock market as soon as the deal is complete.

Centaur has been open to bids since last year. Emap and UBM pulled out before Christmas but it is understood Incisive and HG Capital were in the game until last Friday. The development took the industry by surprise.

Many feel Numis paid an exceptionally high price given Centaur’s financial results, which have been hit by the advertising downturn. Analysts also considered it an extremely high risk strategy if the flotation fails.

Centaur’s previous attempt to float at an estimated £100m failed when the market fell flat.

Sources said it was a very competitive auction and stressed it was “not a done deal”. “It is a very unusual structure and very risky,” one said.

The atmosphere among journalists at Centaur was said to be one of uncertainty this week – even though some believe the implications to be less severe than if it was bought by a rival.

“The risks for journalists are probably less than if it had been taken out by a trade buyer who would have been looking to take out a lot of duplication.

As it has been bought by a standalone business, there will be no obvious rationalisation to pursue,” one analyst said.

By Ruth Addicott

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