Onex in talks with advisers on future ownership of Emerald -sources

By Amy-Jo Crowley and Milana Vinn

LONDON (Reuters) -Onex has been in talks with potential advisers about the future ownership of Emerald, a U.S.-based trade show organiser, as the business events sector has rebounded from the pandemic, two people familiar with the matter told Reuters.

The Toronto-based buyout group has discussed options such as a full or partial sale of its 90.7% stake in Emerald, the people said, speaking on condition of anonymity. It may kick off an auction process at the end of the year or early next year, one of the people added.

The sources cautioned deliberations remain at an early stage and that a deal is not certain.

A spokesperson for Onex confirmed receiving a request for comment from Reuters but did not respond further. Emerald did not respond to requests for comment.

Emerald shares ended trading in New York on Tuesday up 13% at $4.31, giving the company a market value of about $271 million.

A deal would follow a rebound in valuations in the events market. UK events organiser Hyve Group agreed in June to a 524 million pound ($650 million) offer from private equity firms Providence and Searchlight, while Informa in March announced it bought smaller rival Tarsus for $940 million.

Possible bidders could include strategic buyers or private equity firms that could use Emerald as a platform to pursue a “buy and build” strategy to consolidate the fragmented sector, two of the sources said. California-based Emerald produces more than 140 trade shows a year spanning industries including retail, food, luxury, sport and technology.

Onex acquired it from Nielsen Holdings for $950 million in 2013 – when it was called Nielsen Expositions – before listing it on the New York Stock Exchange in 2017.

It held onto the business through the COVID-19 pandemic when the events industry came to a sudden halt, heavily impacting the company’s revenue and earnings.

Emerald is now targeting more than $100 million of adjusted EBITDA and $400 million in revenue for the full year 2023, according to its second quarter results.

Revenue was $208.8 million for the first half year of 2023, up 22% from 169.9 million a year, partly driven by an increase in subscription services, newly launched events and acquisitions.

($1 = 0.8068 pounds)

(Reporting by Amy-Jo Crowley and Milana Vinn; editing by Anousha Sakoui, Emelia Sithole-Matarise and David Gregorio)