PE Tech Report

NEWSLETTER

Like this article?

Sign up to our free newsletter

American Capital completes sale of People Media

American Capital has completed the sale of its online dating portfolio company People Media to Match.com, an operating business of IAC.

American Capital has completed the sale of its online dating portfolio company People Media to Match.com, an operating business of IAC.

American Capital received USD57m in cash proceeds and realized a gain of USD15m in the third quarter from the transaction.

American Capital’s compounded annual rate of return was 30 per cent, including dividends, interest and fees earned over the life of the investment. Including investments in People Media by American Capital’s affiliated funds under management, the inception to date realized gains were USD26m and the compounded annual rate of return was 35 per cent. The proceeds received by American Capital were greater than the first quarter 2009 valuation of the investment by USD6m, or 11 per cent.

American Capital and its affiliates invested USD56m in a senior term loan, senior subordinated debt and preferred equity in People Media, formerly Zencon Technologies, in May 2007.

Including the sale, American Capital received 2.7 times its equity investment, and realized a compounded annual rate of return of 76 per cent over the life of its equity investment, including dividends and fees.

"The sale of People Media is an excellent outcome for American Capital, creating strong returns for American Capital and its funds under management," says Miles Arnone, managing director, technology group. "Throughout our two year investment, the company has achieved significant objectives, including launching a partnership with AOL Personals, which have assisted in solidifying its leading position in the targeted online dating market. As an even stronger company now, we believe People Media will continue to thrive under the leadership of its new owner."

People Media is a provider of targeted online dating communities. The company’s 27 focused dating websites enable adults to meet online in a safe and convenient setting and participate in a community, become friends, date, establish long-term relationships or marry. The company’s websites are focused on specific demographic groups and include BlackPeopleMeet.com, SingleParentMeet.com, SeniorPeopleMeet.com, BBPeopleMeet.com and LDSPlanet.com, with a combined 255,000 paying subscribers.

Since American Capital’s August 1997 IPO through the first quarter of 2009, the company has earned a 16 per cent compounded annual return, including interest, dividends, fees and net gains, on 255 realizations of senior debt, subordinated debt and equity investments, totaling USD11bn of committed capital. These realizations represent 48 per cent of all amounts invested by American Capital since its August 1997 IPO.

Like this article? Sign up to our free newsletter

MOST POPULAR

FURTHER READING

Featured