The deal of the year in Romanian online media

As for the reasons underlying 3TS’ decision to enter InternetCorp’s ownership structure, József Kövér, partner at the private equity/venture capital firm names the growth potential of the online media market in Romania, as well as InternetCorp’s leadership position in the market.

“According to Gemius (a research company) online advertising spending was only €2 per internet user in Romania in 2008. That is a lot less than in most other countries in Central and Eastern Europe, so despite the current recession mid-term substantial growth is inevitable. The second is that on this promising market Internet Corp is one of the leading independent players, run by seasoned and talented entrepreneurs who we welcome the opportunity to team up with”, said Kövér.

Before starting talks with InternetCorp, 3TS analyzed the market and held negotiations with a handful of selected companies. The most difficult point throughout the negotiation process was to agree on the financial details of the transaction, according to József Kövér.

The financial performance of the company and the potential of the online advertising market are both important factors in establishing the real value of an online media player.

3TS’ partner said this investment was sending a clear signal to the market, that there was enormous potential in this industry. In this context, Kövér expects more deals initiated by strategic investors. “Well branded proprietary media content, online classifieds, and content aggregation sites (e.g. price comparison or news aggregation sites) are in my opinion very interesting segments”, he added.

A piece of advice to entrepreneurs interested in selling their business? “Sell at the right time. Before selling to a strategic investor partner up with a financial investor who can help you accelerate your growth and maximize the value of the business”.

3TS Capital Partners is a private equity and venture capital firm in Central and Eastern Europe operating in the whole region through offices in Budapest, Bucharest, Prague, Vienna and Warsaw. 3TS targets investments in growth sectors including Consumer & Services, Media & Marketing, Technology & Telecoms and Energy & Environment. Investors in the 3TS funds totalling over € 200 million include 3i, Cisco, Sitra, EBRD and KfW among others.