Gustavo Ballvé on April 27th, 2010
Corporate Strategy, Food for thought, Home, Industries, Investment Themes, Media, Portfolio Management

In another episode of an ages-old game, Nielsen (of TV ratings fame), formerly VNU, is set to make a triumphant return to the equity markets merely 4 years after being taken private. VNU was one of our international holdings that were LBO’d in the final stages of the booming markets in 2006 and early 2007, along with Laureate Education (International higher-education player that owns, for instance, Anhanguera in Brazil) and others. These cycles make for interesting opportunities to reacquaint ourselves with companies we admire in businesses we like, and hopefully our efforts to understand these companies in the past will again pay off.

Back to Nielsen/ VNU: the controlling group is surveying the markets for an IPO valuing the company’s EV in the $17 to $21 billion range, compared to the $10 bi LBO in 2006. That said, the company is set to earn a respectful $1.6Bi in Ebitda in 2010 (in this case not that many fixed assets, but we’d still prefer to see the free cash flow figures). The debt is $8.6Bi and the annual interest is approx. $500 million, but at least some of the proceeds would likely go towards reducing this debt.

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