Destination Group, a Los Angeles investment firm, and a European partner have invested nearly $85 million in two media companies.
The group will invest about $57 million in Epb.communications, a New York-based privately held media company, and an estimated $25 million in Real Media Inc., a privately held New York-based Internet advertising firm. Equity stakes were not disclosed.
"We see tremendous opportunity in the post-bubble environment for Internet firms," said John Brady, a principal at investment firm Colony Capital. Brady likened these investments to those he made as a real estate investor during downturns in the early 1990s.
"Some of this is just the capital markets overreacting" to problems at some Internet firms, Brady said.
Real Media sells banner ads and serves them to Web sites. Like infomercials, banner ads allow shoppers to make their purchase immediately.
Internet advertising specialists such as Real Media have seen their valuations plummet in the Internet stock fallout of recent months. Real Media's publicly traded competitor, New York-based DoubleClick Inc., has seen its stock plunge 91% this year. DoubleClick closed Friday at $10.03, up 84 cents in Nasdaq trading.
Destination Group, an estimated $100-million equity fund formed in January by Brady and George Macken, a former media and marketing executive, has investments in three other firms and offices in Dallas and San Francisco.
Its European partner, PubliGroupe Ltd., is a Swiss-based, publicly traded communications and services company with 2,900 employees.