Federated Media, the advertising agent to blog stars, is pondering its exit. Founded less than two years ago by former Industry Standard publisher John Battelle, the startup raised an undisclosed amount of venture capital last year from Panorama Capital.

According to a MergerMarket report obtained by TechCrunch, Federated Media COO Jason Weisberger is very open to a takeover bids. In fact, he suggests who the buyers should be:

“If Federated Media keeps performing the way we’ve predicted in 2007, it would be a really ripe time for a media player who understands this space to buy us now rather than having to buy us for a whole lot more later... While he was unsure how much Federated might sell for, Weisberger said similar companies have gotten 8x to 10x gross revenue…Another possible valuation for a sale of the company is a multiple of 25x EBITDA.”

There was a laundry list of possible acquirers mentioned by Weisberger, including media companies (AOL, CBS, Google, IAC/Interactive, Fox, Yahoo were mentioned) and advertising agencies (Universal McCann, Ogilvy & Mathers, aQuantive, Saatchi & Saatchi, and TBWA/Chiat/Day).

Battelle responded to the TechCrunch post by saying that Federated Media is neither for sale nor actively seeking funding. He added that Weisberger thought the MergerMarket discussion was on background.

As noted in that blog's comments section, neither a media company nor a follow on venture capital firm would be willing to pay the multiples quoted by Weisberger. A Federated Media buyer would be gaining little more than relationships with coveted publishers. That's valuable, but not 8 to 10x valuable. And what value there is, could only be captured via uncertain two and three-year earnouts.

For more on Federated Media, see:
TechCrunch

Tags: fm, federated+media, ads, , vc, venture+capital