A March 27 article in the Times of London online edition says Yell Group is planning to pursue an acquisition of TransWestern Publishing, which recently disclosed it had retained Goldman Sachs to €œexplore its strategic options.€
This report comes as no great surprise to us, since Yell has a well-stated ambition to achieve a true national footprint for its Yellow Book division. As it stands, Yellow Book, the largest competitive publisher in the U.S., is in the best position among U.S. operators to declare itself a national publisher. Buying TransWestern would further enlarge Yellow Book€™s footprint, as well as its base of revenue. Assuming the Times report is true, the burning question is how much is Yell willing to pay, particularly if multiple bidders drive up the price?
The general consensus has been that TransWestern could fetch upwards of US$1 billion. Yell€™s most likely competition will come from private equities, which still hunger for Yellow Pages deals that have generally performed well, and at times spectacularly, for investors.