When London-based United Business Media announced late last week that it had acquired Canon Communications, one of the initial questions that came to mind was whether the $287 million price tag—while significantly larger than any other deal in b-to-b publishing since before the economic downturn—was in fact enough for owner Apprise Media and private equity investor Spectrum Equity Investors to turn a profit.

Backed by Spectrum, Apprise acquired Canon from fellow media industry private equity firm Veronis Suhler Stevenson in 2005 for approximately $200 million. But make no mistake: the Canon that was acquired in 2005 by no means was the same company that was purchased by UBM. I drilled back through Canon’s slew of press releases over the years to refresh my memory about the company’s aggressive buying spree starting in 2006. [See a timeline of acquisitions below.]

So, will the $287 million acquisition price be enough to cover the initial investment plus all the acquisitions, and still have some left over for profit? “It’s likely that Canon was going to need to restructure its balance sheet due to debt, and was faced with restructure or selling,” one CEO tells me.  “It’s highly unusual for any media company to sell into this market unless they have to. My guess is that the deal price covered the various acquisition investments, and other investments made in the business, but that there was not much profit left for its owners.”

Not so, says Canon chairman and CEO Charles G. McCurdy. “Canon’s loan facilities were set up in May 2005 at the original Spectrum/Apprise acquisition, and are set to mature in May, 2011,” McCurdy explains over e-mail.  “We have brought our leverage ratio (the ratio of total debt to EBITDA) from over 7x at the outset to under 4.5x now by growing earnings and paying down principal.  We were on a path last June to fully pay off Canon’s old debt facilities with new borrowings when UBM made their approach.”

While under private management, Canon never released any specific performance details but did issue a pair of statements announcing revenue growth. In November 2007, the company said revenue for the fiscal year ended September 30, 2007 increased 22 percent and that EBITDA grew 34 percent, compared to the same period the prior year. Canon’s fiscal year ended September 30, 2008 saw revenue jump 23 percent over 2007. At the time, the company attributed its growth to its strategic acquisitions and operational growth.

UBM said that in the 12-month period ended June 30, Canon generated $106 million in revenues and $37 million in EBITDA on a pro forma basis. Apprise acquired Canon in 2005 for approximately $200 million.

McCurdy tells me Canon worked on parallel paths—preparing for new financing while also negotiating with UBM through the summer, until the deal was completed last week. He says Spectrum is “making a profit on their Canon investment.”

And another thing is for certain: After reporting on countless small multiple, fire sale-type sell offs in trade publishing over the last several months, it is important to note that this deal is the biggest we’ve seen in quite some time.

“This stands in contrast to the very disappointing investment results many have seen in the media sector in recent years, including the business-to-business sector, and the whole Canon organization is very proud of that outcome,” McCurdy says.  “UBM is buying a company with a great team, strong momentum and many avenues of growth in place.”

"The most significant thing," says another b-to-b industry CEO, "is that Canon and the Access Intelligence deal are the first two significant b-to-b media deals completed in the last two years that were not distressed transactions. These are strategic deals for high quality b-to-b media assets at more normalized multiples: not at the 10x plus of the market high but at high single digits (7-9x EBITDA) which are much better pricing than the distressed (Reed, Nielsen, etc.) deals that were completed during the last 12 to 18 months."

Canon’s Announced Acquisitions Since 2005:

March 1, 2006: Acquired Octo Media Ltd, a London-based trade magazine publisher (including Medical Device Technology magazine) and event organizer.

May 10, 2006: Agreement to acquire eight trade shows and one magazine dedicated to the U.S. advanced, technology-based manufacturing sectors from Reed Elsevier.

September 4, 2007: Acquired Engel Publishing Partners from Euromoney Institutional Investor PLC.

October 9, 2007: Purchased two leading trade shows in Germany, INTERPART and SURFACTS, as part of its expansion in the European market.

February 6, 2008: Bought the Pharmapack trade show from French organizer Oriex (Organization of International Congresses and Exhibitions).

May 6, 2008: Acquired Stamping-Days, a biannual exhibition serving the high precision stamping technology industry in Germany.

February 16, 2010: Purchased the worldwide assets of Electronic Design News (EDN), Design News, Test & Measurement World, and Packaging Digest from Reed Business Information.

May 3, 2010: Acquired Pharmalot, a blog focused on news and information in the pharmaceutical industry.