Primedia Provides Optimistic Projections for About Acquisition
Primedia
(PRM)
expects its proposed acquisition of
About
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to produce at least $350 million of consolidated earnings before interest, taxes, depreciation and amortization in the first 12 months following the merger, a 40% increase from the projected figure in 2000.
Primedia's stock was hammered
Oct. 30 after the company disclosed plans to acquire Internet company About in a deal originally valued at $690 million, falling 28.7% to $10.88. About's shares rose 56 cents to $24.44. Primedia has since rallied slightly, trading today at $11.94, but well off the 52-week high of $34.88.
Primedia, a media company with print, video and Internet businesses, expects to close the acquisition in the first quarter of 2001.
The company is on target to report about $250 million of consolidated EBITDA for 2000, which includes a loss before interest, taxes, depreciation and amortization of $90 million from new media operations.
Primedia expects the new media operations of the combined company to be profitable in 2002.
