Media M&A (mergers & acquisitions) were up in 2011. 896 deals were done representing $47 billion dollars in value (damn, who says publishing is dying?). When M&A is up in an industry I believe it is indicative that value and growth is trending positive and money is flowing and churning!
Bottom line: publishing is NOT hurting. Some think it is because these figures don’t come close to the banner year of 2007 ($104 billion in deals done!) … Sounds like a bunch of spoiled greedy bastards to me 🙂
But, the publishing industry (including, of course, digital) is growing and trending positive and the outlook for 2012 looks to be even better according to JEGI (Jordan Edmiston Group Inc.) , a leading independent investment bank for media, information, marketing services and technology.
Overall Media M&A Up 9 Percent in 2011
Marketing and interactive services drive growth with 32 percent of total value.
The media M&A market saw its third year in a row of growth, closing out 2011 with a 9 percent increase in total value over 2010, according to a year-end report by The Jordan, Edmiston Group.
There were 896 deals done, says the investment bank, 15 more than 2010 and more even than in the blockbuster year of 2007. Total value, however, still hasn’t come close to that year. In 2011, the deals represented $47 billion in value, up $4 billion from 2010, whereas 2007 saw $104 billion in deals done.
A key trend in 2011 was marketing and interactive services, which represented 32 percent of total deal value and accounted for 17 of the 32 biggest deals, and a third of total transaction volume.
And while expectations remain high for private equity, strategic buyers were decidedly more acquisitive. Out of the 32 largest deals (more than $400 million), 24 were done by strategics.
Sector by sector—JEGI tracks 10—exhibitions and conferences recorded a 249 percent increase in deal value over 2010. There were 32 deals totaling $451 million. JEGI points out that the fourth quarter marked quite a bit of activity from strategic buyers, with UBM, Bonnier, Diversified Business Communications, PennWell and Reed Elsevier making deals.
Consumer magazines also had a busy year with 32 transactions valued at $3.2 billion, a huge jump over 2010’s $214 million deal value.
B-to-b media was comparatively quiet, recording only 14 deals and $50 million in value—a 62 percent and 91 percent decline from 2010, respectively. B-to-b online media and tech, however, spiked appreciatively in value. The year’s 63 deals were 2 more than 2010, but value jumped 132 percent to almost $6 billion.
Interestingly, mobile media and tech declined slightly in volume with 72 deals done in 2011 versus 77 in 2010, but value jumped 37 percent to almost $2 billion.
John’s Note: Before I send you to the parent article I want to define a couple business/investing terms for those that may not readily recollect them for convenience and better understanding:
EBITDA – Earnings Before Interest, Taxes, Depreciation and Amortization
Strategic Buyer – A buyer in the same line of business who wants to buy and hold.
Financial Buuyer – A buyer (usually from a Private Equity Group [PEG]) that wants to buy low and sell high.