News
06/02/2007 - Carlyle and KKR among 9 bidding for New Zealand Yellow Pages
Carlyle Group, Telstra and Kohlberg Kravis Roberts are among at least nine companies bidding up to 2.2 billion New Zealand dollars, or $1.5 billion, for the Yellow Pages directories unit of New Zealand's Telecom, three people with knowledge of the sale said.
CCMP Capital Asia and Pacific Equity Partners also lodged bids Friday, the people said, declining to be identified because details are not public. Telecom, New Zealand's largest phone company, hired Goldman Sachs JBWere in November to sell the unit to bolster returns after earnings growth stalled.
"The unit has a very good position in a market where there are high barriers to entry," said Atul Lele, who helps manage the equivalent of $322 million at White Funds Management in Sydney, including Telecom stock.
Directories companies worth more than $6 billion have changed hands in the past two years as buyout firms including the New York-based based KKR seek assets with dependable cash flow that can service the debt used in leveraged takeovers.
KKR bought France Telecom's phonebook unit, PagesJaunes, for €3.31 billion, or $4.3 billion, in November.
Telecom's Yellow Pages is forecast to post sales of about 280 million dollars in the year to June 30, according to the people. Bidders who progress to the second round will be informed by the end of this week, they said.
Bain Capital, Providence Equity Partners, Texas Pacific Group, and CVC Capital Partners have also entered bids, according to the people. Marko Bogoievski, Telecom's finance chief, told reporters that there has been "incredible interest" in the unit, declining to comment on bidders.
Hayley Morris, a spokeswoman for Goldman Sachs JBWere, did not return calls seeking comment. Representatives of the bidders either declined to say anything or could not be reached for comment. Telecom has said it expects to complete the sale by June 30.
Sensis, the directories unit of Melbourne-based Telstra, is the strongest industry bidder for Yellow Pages, Laurent Horrut, an analyst at JPMorgan Chase, wrote in a November report. Macquarie Bank, Australia's largest securities firm, decided not to bid, the people said.
Telecom last week posted a 228 million dollar second-quarter profit on demand for mobile and broadband Internet services.
http://www.iht.com/articles/2007/02/04/bloomberg/sxyellow.php
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