M&A Prospects 2009
Deals are down but that means prices are too.
The number of media acquisitions has plummeted over the last year and thereâ€™s little chance of a rebound in 2009, particularly for the blockbuster, private equity-driven deals that dominated the marketplace until recently.
However, attendees at last monthâ€™s DeSilva & Phillips Media Dealmakers Summit said they are looking for deals, particularly as prices that have soared during the latest boom, come back to earth. â€śThe last three deals we did were 3X, tops,â€ť said Pat Kenealy, managing director of IDG Ventures SF. â€śYou can do deals now at a price you wouldnâ€™t have dreamed of a year ago.â€ť
Kenealy said social networks are monetizeable. â€śWeâ€™re seeing business models emerge,â€ť he added. â€śWe invested in a company that makes Facebook applications for industries such as nursing. Six months later there were more than 600,000 nurses using it. Compare that to the typical controlled circulation.â€ť
Print, Events Still Worthy
Other attendees said they are still looking for traditional media as well. Reed Exhibitions CEO Mike Rusbridge said Reed is exploring acquisitions in the U.S. â€śWe havenâ€™t seen anything as appealing as expos,â€ť he added. â€śConferences donâ€™t do it and events in general donâ€™t do it either.â€ť
Many attendees spoke of developing print models more dependent on subscriptions and paid content. The Economist Groupâ€™s Roll Call gets 50 percent of revenue from subscriptions. Overall, The Economist Group has seen events impacted more severely than print, according to director of development Todd Tauber.
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