Trade Shows and Digital Drive Business Media M&A, in That Order
Lucrative event businesses attract both new and familiar suitors to the sector.
The long-prophesied wave of b2b media consolidation has not come crashing down quite yet, but the sector still saw its fair share of significant mergers and acquisitions over the first six months of 2016.
The year began in the wake of Cision’s $841 million purchase of PR Newswire from UBM, which continues to reassert it’s “events-first” business strategy.
“Our events-first strategy does not mean we are an events-only company,” a UBM spokesperson cautioned Folio: after the company sold off its electronics media portfolio to Arrow Electronics for $23.5 million in June, but CEO Tom Cobbold adds that he expects more of the company’s media properties to hit the block going forward.
Indeed, several b2b publishers have made significant events-focused acquisitions as the trade show and conference business continues to mitigate declining print revenues. In April, UBM spent $69 million to acquire fashion shows in New York and Las Vegas from Business Journals Inc. That was followed by UBM’s $17.6 million purchase, in June, of the Content Marketing Institute, including the annual Content Marketing World conference.
While UBM may be the noisiest, it’s not the only company looking to grow its presence in the b2b events space. In January, Vendome Group acquired the Healthcare and Capital Markets Conference, and Vendome founder and CEO Jane Butler told Folio: that — even before the acquisition — events accounted for as much as 40 percent of company revenues.
As a relatively stable and inherently diversified revenue source, seemingly immune to many of the challenges facing print and digital publishing, conferences and trade shows are luring an increasing number of outside investors to the industry, particularly private equity firms.
Perhaps most active has been The Wicks Group, majority shareholder of Argyle Executive Forum, which purchased Innovation Enterprise in May. The haul included CFO Publishing and its 30-year-old flagship, CFO Magazine, but the real jewel in the transaction was Innovation Enterprise’s 122 live events around the world. Just days earlier, Wicks had acquired Bisnow and its massive event business for over $50 million.
Not everyone sees conferences and trade shows as the industry’s sole saving grace. Following the acquisitions, Wicks sold off Northstar Travel Group to another private equity firm, Wasserstein Partners, which also owns Penton and ALM Media. Announcing the sale, Northstar CEO Thomas Kemp touted his company’s diverse but integrated channels.
“I think the whole concept of only buying large, standalone exhibitions is frankly a higher-risk position,” Kemp told Folio:. “You’re not nearly as connected in the market without data analytics and a full depth of integrated information channels. We’re focused on a full suite of solutions, rather than a single solution. When tradeshows go well, they go really well, but when they turn, it gets ugly.”
Consolidation was felt most when Stagnito Business Information, Edgell Communications, and the Path to Purchase Institute were acquired and by RFE Investment Partners and merged into what RFE claims is the most comprehensive media group to serve its respective market.
“The whole concept of what we’re trying to develop is a media company that really surrounds a given market, in this case the retail and consumer packaged goods space,” Alan Glass, executive chairman of the merged companies, told Folio: at the time.
Other transactions in the b2b media space this year include Questex’s July purchase of ExL Events, Purch’s acquisition of Business.com, Markets Media’s purchase of Traders magazine, and Industry Dive buying Social Media Today before selling The Social Shakeup, an annual conference, to Access Intelligence (which owns Folio:).
Most recently, Adweek, which was spun off from Prometheus Global Media last year, was bought by Canadian private equity firm Beringer Capital for a reported $20 million.
While difficult to accurately compare year-over-year — and often skewed by small sample sizes and questionably relevant transactions like Microsoft’s massive purchase of LinkedIn in June — M&A activity appears to be increasing in business media. A July report from JEGI indicated that the number of deals increased 14 percent during the first six months of 2016, compared to the same period last year.
Whether activity will pick up in the second half is anyone’s guess — about two-thirds of respondents to AdMedia Partners’ annual media industry M&A survey said they expected to seek acquisitions this year, with another 53 percent exploring a possible sale. Beyond question, however, attractive targets remain on the market — including IDG, which went fully digital last October before retaining Goldman Sachs in January to explore “strategic options.”