Report: Media Deal Values Fall 70 Percent
Small- and mid-size growth sector transactions on pace with last year.
Through the third quarter, transactions in the media, information, marketing services and related technologies sectors are down 70 percent over the same period last year, says an M&A report released Thursday by the Jordan, Edmiston Group.
Overall, JEGI tracked 619 media deals through the third quarter this year, with a combined value $26.6 billion —down severely from $87.5 billion over 636 deals during the same period last year.
Deal values during the period were down in 10 of the 11 industry sectors tracked by JEGI, with b-to-b magazine values falling 87.4 percent and consumer values down 95 percent. Deal values in the online media and technology category, totaling $7.7 billion, were down only 6.9 percent.
The number of newspaper transactions was practically identical to the number this period as last (33 this, 31 last year) but deal value plummeted 93 percent to $936 million (was $13.3 billion in 2007).
Newsletter publishing posted $153 million over 11 deals, and was the lone category to see a value increase (up 10.1 percent). Database information services was the most active category year-to-date with 36 deals (up 63.6 percent over 22 deals last year). Deal value in the category, however, was down nearly 60 percent.
Declining deal value is indicative of the financial uncertainty in the U.S. and global markets. Private equity groups are holding onto their money, the report says, controlling $450 billion in uninvested capital worldwide.