Germany-based media group ProSiebenSat.1 divested a significant part of its media-for-equity portfolio to US-based private equity firm Lexington Partners yesterday for a mid-eight digit euro figure (€50m = $57m).
ProSiebenSat.1, which operates a corporate venturing unit called SevenVentures, makes financial investments in startups and also participates in media-for-equity deals that involve it acquiring stakes in companies in return for providing advertising.
The deal will include minority stakes in up to 16 companies that are held by ProSiebenSat.1 subsidiaries including SevenVentures, and the assets will be transferred to a newly formed fund called Crosslantic Capital.
SevenVentures will retain a 24.5% share of Crosslantic Capital and the rest will be held by Lexington Partners. Sascha van Holt, managing director of SevenVentures, will manage the fund.
The specific portfolio companies involved in the transaction were not disclosed, but ProSiebenSat.1 said it generated an internal rate of return of about 30% from the stake sale.
Sabine Eckhardt, ProSiebenSat.1’s chief commercial officer, said: “With the value of our media and cash investments doubled, we have significantly increased the market value of the SevenVentures investments through TV advertising on our stations, which has been to the advantage of both parties.
“This further underscores the success and the sustainability of our media-for-equity model.”