Federated Media Not Looking to Sell
10:25 am March 8th, 2007 by Sal Cangeloso
Some communication wires were crossed last night and the end result was TechCrunch was offering up some serious misinformation when they posted that Federated Media was looking to sell. Apparently there was some confusion after FM COO Jason Weisburger was quoted by MergerMarket.
From the article:
Weisberger said “If Federated Media keeps performing the way we’ve predicted in 2007, it would be a really ripe time for a media player who understands this space to buy us now rather than having to buy us for a whole lot more later.” The article also said “While he was unsure how much Federated might sell for, Weisberger said similar companies have gotten 8x to 10x gross revenue…Another possible valuation for a sale of the company is a multiple of 25x EBITDA.”
John Battelle eventually weighed in and set the record straight, after which TechCrunch revised the post, but the headlines were already all over the blogosphere. There is an official response on FM’s blog.
It would be an interesting move for FM to sell right now, but I think they are doing too well to sell at the moment. They are handling their growth pretty well and, I don’t mind saying, that they have an incredible list of publishers. Their’s is a new model for advertising that is not only off to a great start, but one that is not well suited to a large company like some of the prospective buyers listed in the article (AOL, CBS, Google, IAC/Interactive, Fox, Yahoo, Universal McCann, Ogilvy & Mathers, aQuantive, Saatchi & Saatchi, and TBWA/Chiat/Day).
There were a few interesting comments at the TechCrunch article. Many disagreed with Jason’s valuation numbers and others complained about FM’s high CPM rates (those people clearly do not understand FM and don’t see it as any different from the competition).
All told, a pretty interesting start to the day…
