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      MERGERS AND ACQUISITIONS UPDATES FROM BERKERY NOYES

    Entries in Marketing (21)

    Monday
    Feb032014

    MEDIA & MARKETING DEAL VOLUME STAYS CONSTANT AS VALUE SOARS

    Berkery Noyes has issued its Media & Marketing report for full year 2013. The firm’s research showed that deal volume remained nearly constant on a year-to-year basis. However, this represented a six percent rise compared to 2011. Strategic acquirers accounted for 91 percent of the industry’s deal volume in 2013, an increase of five percent relative to 2012.

    Total deal value showed a gain of 28 percent, from $75.81 billion in 2012 to $97.30 billion in 2013. Of note, the announced merger of Publicis and Omnicom was responsible for 21 percent of the industry’s aggregate transaction value in 2013. In terms of valuations, the median revenue multiple increased from 1.4x to 2.0x, while the median EBITDA multiple rose from 8.0x to 9.7x. In both instances, this marked a return to valuations that were seen in 2011.

    The segment with the largest year-to-year rise in volume was Consumer Publishing, which increased 16 percent, from 167 to 193 transactions. Harland Clarke’s announced acquisition of Valassis Communications for $1.78 billion in the shopping guides and coupon subset was the segment’s highest value transaction in 2013. As for other markets covered in the report, deal activity in the Entertainment segment increased six percent between 2012 and 2013. 

    Although the Broadcasting segment saw a decline in volume, its corresponding aggregate value more than tripled. There were 13 Broadcasting transactions above $100 million in 2013, accounting for $11.48 billion in total value.

    “Strong merger and acquisition activity should persist as publishers, advertising agencies and others continue to adapt to change by expanding their digital offerings,” said Mary Jo Zandy, Managing Director at Berkery Noyes. “As the lines between content, marketing and advertising continue to blur, their product depth and breadth will encompass more. All of this has the potential to help fuel M&A activity in the foreseeable future.”

    Tuesday
    Nov052013

    AGGREGATE VALUE IN THE MEDIA AND MARKETING INDUSTRY NEARLY DOUBLES WITH TWO MEGA DEALS DURING THIRD QUARTER 2013

    Berkery Noyes has issued its Media and Marketing report for third quarter 2013. Total value increased 98 percent on a quarterly basis, from $22.3 billion to $44.1 billion. This significant rise was mainly attributable to two announced transactions: the proposed merger of Publicis and Omnicom in the Marketing segment, and the management buyout of Activision Blizzard in the Entertainment segment. Aggregate value would have increased six percent without the Publicis-Omnicom merger. If the management buyout of Activision Blizzard is also excluded, overall value would have declined 31 percent.

    Upon examination of the Marketing segment, volume remained nearly constant, totaling 132 transactions in third quarter 2013. The Publicis-Omnicom merger marks a distinct turning point in the sector, with the creation of a new market leader that is larger than rival WPP. In addition, many transactions in the space up to this point, such as those completed by Publicis, have involved start-ups as well as small overseas targets.

    “This merger of equals reinforces how the need to compete with some of the larger technology/media companies, including Google and Facebook, is increasing the need for scale at the agency level,” said Evan Klein, Managing Director at Berkery Noyes.

    M&A volume in the Consumer Publishing segment increased 27 percent in third quarter 2013. There were several notable newspaper transactions during the quarter that were completed by individual billionaires. Jeffrey Bezos, the founder of Amazon.com, acquired The Washington Post Company for $250 million. Several weeks prior to this, John Henry, the principal owner of the Boston Red Sox, acquired The Boston Globe from The New York Times for $70 million. These prices reflect the difficulties facing newspaper publishers as traditional advertising, a decline in print subscribers, and the shift toward digital content upends the sector’s historical business model. Meanwhile, Warren Buffet has shown an interest in acquiring local newspapers, as indicated by several of Berkshire Hathaway’s deals throughout the last two years.

    Wednesday
    Jul242013

    MEDIA AND MARKETING DEAL VOLUME STAYS CONSTANT AS AGGREGATE VALUE DECLINES

    Berkery Noyes has issued its Media and Marketing report for half year 2013. Deal volume stayed about the same during the last six months, decreasing slightly from 800 to 794 transactions. Total value declined 37 percent, from $47.37 billion to $29.45 billion. The median revenue multiple increased from 1.6x to 2.1x, which was its highest level on a half year basis throughout the past 30 months. However, the industry’s median EBITDA multiple held constant at 8.3x.

    Consumer Publishing had the largest half-to-half year rise in volume, increasing 21 percent since second half 2012. At the same time, M&A volume in the Entertainment segment improved 11 percent. The amount of deals in the B2B Publishing and Information segment increased five percent, rising from 86 to 90 transactions in the prior half year period.

    The Marketing segment’s volume experienced a slight uptick over the past six months, totaling 252 deals in first half 2013. WPP continued its acquisition spree with nine transactions during this timeframe. Meanwhile, the largest deal in the digital marketing subsector in first half 2013 was Accenture’s acquisition of Acquity Group for $285 million, which represented a 2.0x revenue multiple and 13.9x EBITDA multiple.

    “Not surprisingly, many acquirers are placing an emphasis on analytics that can increase the effectiveness of their marketing efforts,” said Evan Klein, Managing Director at Berkery Noyes. “The desire to offer a more comprehensive suite of solutions, including those with a social and mobile component, is helping to spur M&A activity.”

    Monday
    Apr152013

    MEDIA AND MARKETING M&A VOLUME STAYS CONSTANT IN Q1 2013

    Berkery Noyes has issued its Media and Marketing M&A report for Q1 2013.

    According to our latest research, transaction volume remained relatively constant over the past three months, rising two percent compared to Q4 2012. Deal value showed a decline of 68 percent, from $25.6 billion in Q4 2012 to $8.2 billion in Q1 2013. Eight of the top ten largest acquisitions in 2012 occurred in either the third or fourth quarter, which contributed to this steep quarterly value decrease. 

    Transaction activity in the B2B Publishing segment increased ten percent on a quarter-to-quarter basis. Meanwhile, M&A in the Entertainment Content segment increased 13 percent in Q1 2013.

    One new Internet Media acquirer during Q1 2013 was Pinterest. The social networking site acquired Punchfork, a social culinary website, within the segment. This was the company’s first acquisition since its launch in 2010. Other Internet Media transactions by noteworthy acquirers were Amazon.com’s acquisition of book recommendation site Goodreads, Facebook’s acquisition of blogging website Storylane, and AOL’s acquisition of tech review website gdgt.

    As for the industry’s Marketing segment, transaction volume increased eight percent in Q1 2013. This rise came in the aftermath of a 19 percent decline between Q3 2012 and Q4 2012. Content marketing is one key trend driving innovation in the digital subsector, as is the growing emphasis being placed on experiential marketing solutions.

    “We expect to continue seeing an ongoing shift in advertising spend from print-based to digital media,” stated Mary Jo Zandy, Managing Director at Berkery Noyes. “One of the ultimate goals of doing so is to improve the lead generation process through greater personalization, more targeted messaging, and better measurement of the end results.”

    Thursday
    Jan102013

    MOBILE APPLICATION AND SOCIAL MEDIA MARKETING TRANSACTION VOLUME BOTH UP FOR THE YEAR

    Berkery Noyes has unveiled its Online and Mobile Industry M&A Report for Full Year 2012.

    According to the firm’s research, transaction volume increased four percent on a year-to-year basis and 37 percent relative to 2010. The median revenue multiple improved slightly from 2.1x in 2011 to 2.3x in 2012, while the median EBITDA multiple declined from 11.9x to 10.8x. 

    Oracle was responsible for two of the report’s top ten highest value deals in 2012. This included the acquisition of Taleo, a cloud based talent management provider, for $1.80 billion and the acquisition of Eloqua, a creator of marketing automation software, for $871 million. 

    In the mobile application subsector, the number of transactions increased 18 percent over the past year. Transactions involving mobile consumer applications increased 34 percent, from 121 to 162, whereas those pertaining to mobile business applications rose seven percent, from 158 to 169.

    Meanwhile, volume in the E-Marketing & Search segment increased 44 percent from 2010 to 2011 and eight percent between 2011 and 2012. Much of this activity over the past two years highlights an interest in analytics and interactive marketing, as advertisers and others seek measurable results within targeted demographics. Accordingly, deal flow in the social media marketing subsector more than doubled since 2011.

    “Businesses recognize that their content and customer feedback is being shared through social media with minimal corporate oversight,” said Evan Klein, Managing Director at Berkery Noyes. “Since many consumers have a desire to instantaneously share opinions and recommendations, companies that analyze online social engagement have the potential to alter the current market landscape.” Klein continued, “This is also true within the B2B marketplace, as companies consider making acquisitions to leverage their social marketing efforts targeting both large and small organizations alike.”