Yellow Pages Group Buys Canpages For $225M, Contributes U.S. Ops To ZipLocal

Yellow Media, owner of Yellow Pages Group, is acquiring Canadian Phone Directories Holdings (aka Canpages), a national local search and directories publisher.

The seller is a consortium of investors led by PE firm HM Capital Partners, and the purchase price is approximately $225 million.

While subject to working capital and other adjustments, the $225 million purchase price will be comprised of $75 million payable in cash at closing to settle third party debt obligations and the issuance of $150 million of Mandatory Exchangeable Promissory Notes of Yellow Media. The Notes will rank subordinate to the senior debt of Yellow Media and bear interest at a fixed initial rate of 5%, payable quarterly in cash.

Headquartered in Vancouver, Canpages publishes 84 directories for a total circulation of approximately 8 million copies. The company’s website,, attracts more than 3.5 million unique visitors each month. Canpages generates annualized revenues of $110M, with an online contribution of approximately 23%. The company employs about 700 people in Canada, of which more than 450 are sales consultants.

YPG also announced the contribution of its U.S. directory operations, YPG Directories, publisher of Your Community Phone Book, to Ziplocal, which was acquired by Canpages in June 2009. YCB was itself acquired from Volt Information Sciences in September 2008. After the merger, the combined entity is said to reach over 300 markets across the United States.

YPG says it will continue to own and operate its information technology platform and centers located in Blue Bell, Pennsylvania and Indianapolis, Indiana.