Wilmington Group, publisher of the journalists’ magazine Press Gazette as well as many other business titles, will today confirm that it is in preliminary talks with Hg Capital about a possible takeover by the private equity firm.
While informal talks have been held with Hg Capital, it is understood that a formal offer would be still some weeks away.
Both companies declined to comment and it is not known how long the two have been talking about a possible tie up.
Shares in Wilmington, run by chief executive Charles Brady, fell 2.5p to 165p on Friday, giving it a market value of £136m. One industry source said Hg would likely bid between 200p and 205p, a premium of 21-24 per cent.
The stock has fallen by nearly 15 per cent in the last six months. The group’s assets would fit in well with Hg Capital’s acquisition strategy.
The buyout firm, which earlier this year sold London-based spa and beauty brand Sanctuary to PZ Cussons for £75m, has a special interest in the telecoms, media and technology sector.
Analysts are forecasting a period of consolidation for the small to midcap media market.