M&A Soars For Digital and Marketing Services, While B-to-B Deals Plummet
First half transaction value up 15 percent to $23 billion, per JEGI.
Mergers and acquisitions in the media, information, marketing services and tech sectors in the first half of 2011 may not be matching the breakneck pace of the first half of 2010 (which rebounded 61 percent over a dismal first half 2009) but were still up 3 percent in the number of deals (to 484) and 15 percent in overall value (to $23.28 billion), according to The Jordan, Edmiston Group.
Buyers are putting a premium on digital, with B2B and BSC Online Media & Technology, Marketing & Interactive Services and Mobile Media & Technology accounting for 71 percent of total deals and 63 percent of deal value for the first half of 2011.
Meanwhile, Consumer Magazines generated 16 transactions (up 33 percent) worth $2 billion, driven primarily by Hearstâ€™s acquisition of Lagardereâ€™s magazine portfolio but also TPG Capitalâ€™s purchase of Primedia for $525 million and last weekâ€™s American Media acquisition of OK! for approximately $25 million.
On the other hand, the number of deals in Business-to-Business Media dropped 65 percent to eight while deal value sank 74 percent to $23 million. M&A for Exhibitions & Conferences continued to be few and far between (just 11 in the first half of the year) although deal value tripled over the first half of 2010 to $165 million, with UBMâ€”which bought Canon Communications last year for $287 millionâ€”continuing to ramp up with events (buying Catersource for the event planning industry and ABM Exhibitions, which serves industrial markets).
There was one fewer deal in Marketing & Interactive Services in the first half of 2010, but deal value jumped 81 percent to $5.74 billion. While media companies made several deals in this category (including Penton buying EyeTraffic Media and Dowden Health Media buying Priority Integrated Marketing), those transactions are dwarfed by some others in this category, including New Mountain Capital buying retail market research and software company SymphonyIRI Group for $800 million and Publicis Groupe acquiring Rosetta Marketing Group for $575 million.
Through the second half of 2011 and into 2012, JEGI says it expects more â€śmiddle market M&Aâ€ť as companies ramp up with marketing services and mobile and technology assets.