Yellow Media Inc. is selling its Quebec-based classified ad website LesPAC Inc. to e-commerce firm Mediagrif Interactive Technologies Inc. for $72.5-million as the directory publisher works to pay down its debt.
Mediagrif said Monday it will finance the acquisition with $25-million and term debt financing of $40-million in addition to backing from a revolving credit facility of $20-million.
“This acquisition of LesPAC represents a unique opportunity for Mediagrif to partner with one of Quebec's most visited website,” Mediagrif CEO Claude Roy said in a statement.
“This transaction will bring new opportunities, given LesPAC's strong brand and established online marketplace for consumers. In addition, we are pleased to partner with Yellow Media Inc. to deliver additional services to our users.”
LesPAC.com is Quebec's No. 1 classified website, with 1.8 million unique monthly visitors.
“This divestiture enables us to focus on our core business through continued investments toward our digital transformation,” said Yellow Media president and CEO Marc Tellier.
The company's Mediative marketing division will continue to market and sell display advertisements on LesPAC.com.
Yellow Media said earlier this month that it has begun to focus on paying down its debt and transition to a purely digital company after posting a $2.8-billion loss in its latest quarter related to a writedown of almost the same amount to the value of its business.
The publisher of the Yellow Pages print and online directories logged a $2.9-billion writedown to the value of its business at the end of September.
The Montreal-based company reduced its debt by about $700-million in the quarter after it sold Trader Corp., home of AutoTrader magazine, to London-based private equity firm Apax Partners for $745-million.
Yellow Media has been struggling as it tries to reposition itself primarily as an Internet company. Earlier this year, the company said it would stop paying dividends in an effort to improve its financial position.
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