YP CEO David Krantz wanted to dispel a widely held notion when we spoke with him late last week about the company he now runs, newly acquired from AT&T by the private equity firm Cerberus Capital Management.
“This is not a cash-flow, harvest the business approach,” he said, perhaps referring to the reputation of YP’s new owner as a hard-nosed operator. He insists that Cerberus sees its latest acquisition not as an old line business with cash to extract, but as a billion dollar digital platform with lots of upside.
Krantz was very direct in saying that the YP business was starved for investment under AT&T, which has other investment priorities like its wireless network, among others.
Now, he has money set aside for investment, and plenty of financial maneuverability, despite a debt load of about $1 billion, which he describes as very light for a company with $3.3 billion in revenue. The company’s debt works out to roughly 1X EBITDA, which is low compared with most of YP’s peer companies.
We will share more from our conversation next week in a The Kelsey Report Advisory.
Take a look at our previous blog coverage of this deal: