KEY POINTS:
The four remaining bidders for Telecom's Yellow Pages business have made very similar offers and a source familiar with the deal said choosing the winner was likely to come down to how much each bidder would be willing to co-operate with Telecom in the future.
The bidders are
understood to be Australian media magnate Kerry Stokes' joint venture with US private equity firm Kohlberg Kravis Roberts, the PBL Media joint venture between James Packer and CVC Asia Pacific, private equity firm CCMP, and a joint venture by Bain Capital and Pacific Equity Partners.
Each is said to have bid close to $2.3 billion.
What will separate the bidders is the type of contract each offers to Telecom, which has indicated it wants a continued relationship with Yellow Pages after the sale.
Issues to be considered include how the two businesses will be separated, how Telecom would continue to provide data to Yellow Pages, and shared IT and billing services.
Telecom and its adviser on the deal, Goldman Sachs JBWere, are likely to take a week to sort through the offers and a final decision is unlikely until the end of next week.
Telecom is reported to have told potential buyers that Yellow Pages will earn revenue of $280 million in the present financial year.
A $2.3 billion sale would represent a price of around 14 times earnings before interest, tax, depreciation and amortisation. France Telecom's Pages-Jaunes sold for 15 times earnings last year.
Private equity investors were the only bidders left last month after Australia's Telstra dropped out, saying it was too expensive.
Shares in Telecom closed down 5c at $4.68 yesterday.
APN challenges online directory giant
APN is making a concerted push into the local online directory market with the aim of challenging Telecom's Yellow Pages directories businesses.
APN's Infomedia - which produces Wises Maps online and UBD business directories - has merged with classifieds company finda, in which Herald publisher APN has a 50 per cent stake. The new company is called apnfinda.
The three websites, Wises Map, UBD and finda, have a combined database of nearly a quarter of a million businesses.
* APN owns nzherald.co.nz, the New Zealand Herald, Herald on Sunday, Aucklander and other papers throughout the country. It is also joint owner of The Radio Network.
