Berkery Noyes reports media M&A down 11% in Q1 of 2015, following 16% rise in Q4 of 2014
NEW YORK, NY — April 13, 2015 — Berkery Noyes, an independent mid-market investment bank, today released its Q1 2015 mergers and acquisitions trend report for the Media and Marketing Industry. The report analyzes M&A activity in the Media and Marketing Industry during Q1 2015 and compares it with the past four quarters.
According to Berkery Noyes’ latest research, transaction volume decreased 11 percent in Q1 2015. This followed a 16 percent rise in Q4 2014. Total value declined 35 percent over the past three months, from $24.1 billion to $15.6 billion. Of note, eight of the industry’s top ten largest deals in Q1 2015 were based outside of the U.S.
The industry’s largest transaction in Q1 2015 was Verisk Analytics’ acquisition of Wood Mackenzie. The data analytics and research firm, which focuses on the oil, gas, and mining market, was acquired for $2.8 billion. This marked an exit for private equity firm Hellman & Friedman, which acquired Wood Mackenzie in 2012 for $1.1 billion.
The Marketing segment saw volume remain flat for the fourth consecutive quarter. Marketing deals represented one-third of aggregate volume in Q1 2015, nearly the same percentage as in Q4 2014. It also retained its position as the industry’s most active sector, slightly surpassing the Internet Media segment. The largest Marketing deal year-to-date was Dalian Wanda Group’s acquisition of Infront Sports & Media AG for $1.1 billion. The international sports marketing company offers an array of services such as media rights distribution, brand development, and event sponsorship.
After almost doubling in Q4 2014, the Exhibitions, Conferences, and Seminars segment stayed about constant in Q1 2015, with a total of 25 transactions. The highest value deal in the segment during the quarter was Providence Equity Partners’ acquisition of Clarion Events for $307 million.
Deal activity in the Internet Media segment gained four percent in Q1 2015. This was the segment’s fourth straight quarterly improvement, which included a 17 percent increase in Q4 2014. In terms of recent notable transactions in the space, clothing manufacturer Under Armour acquired MyFitnessPal, a digital health mobile application focused on nutrition, for $474 million; restaurant search and discovery service Zomato acquired information platform Urbanspoon for $52 million, the company’s first U.S. based deal; stock photography provider Shutterstock acquired Rex Features, an independent photographic press agency, for $33 million as well as Premium Beat, a royalty free music website, for $32 million; and Facebook acquired TheFind, a personalized shopping engine, as the social network looks to bolster its digital advertising business.
M&A activity in the Entertainment Content segment declined slightly, from 50 to 47 deals. As for high profile acquirers in the video game subsector, King Digital Entertainment, the maker of Candy Crush Saga, acquired Seattle-based mobile gaming studio Z2 for $45 million. This transaction includes a potential earn-out of $105 million, bringing the enterprise value to $150 million. Sega Networks also completed two transactions in the subsector over the last three months with the acquisition of Ignited Artists and Demiurge Studios.
The number of deals in the Consumer Publishing segment fell 18 percent in Q1 2015. This occurred after a 33 percent increase in Q4 2014. High profile Consumer Publishing transactions thus far in 2015 included New Media Investment Group’s acquisition of newspaper publisher Stephens Media for $103 million and Meredith Corporation’s acquisition of Shape Magazine from American Media for $60 million.
Total volume in the B2B Publishing and Information segment decreased 25 percent on a quarter-to-quarter basis. This followed a 24 percent rise in Q4 2014, which was its peak throughout the past five quarters. In addition to Wood Mackenzie, notable deals in the B2B segment during Q1 2015 included Nielsen’s acquisition of eXelate, a data technology company in the programmatic advertising space, for an estimated $200 million and Dun & Bradstreet’s acquisition of NetProspex, a B2B data services and data management provider, for $125 million.
“Many B2B media organizations are seeking to capture a larger share of marketing spend by providing a host of services to their clients,” said Mary Jo Zandy, Managing Director at Berkery Noyes. “As B2B media create new product and service offerings, their clients – the B2B marketers – continue to divert a growing share of their marketing budget to new marketing services. These offerings are a means to augment revenue.”
A copy of the MEDIA AND MARKETING INDUSTRY M&A REPORT FOR FIRST QUARTER 2015 is available at the Berkery Noyes website.