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.
The top ten largest acquisitions accounted for 57 percent of the industry’s value year-to-date. There were six deals above the $1 billion threshold in both first half 2013 and first half 2012. Deal value over the past two-and-a-half years reached its peak in second half 2012, in which there were 11 transactions that were each over $1 billion. Accordingly, aggregate value in first half 2013 was almost the same as in first half 2012.
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 largest transaction in first half 2013, both in the B2B segment and the aggregate Media and Marketing Industry, was BC Partners’ acquisition of Springer Science & Business Media for $4.42 billion. Another notable deal in the segment was IHS’ acquisition of R.L. Polk, a provider of automotive information and marketing solutions, for $1.40 billion. Within the Broadcasting segment, the highest value transaction was Bell Media’s acquisition of Astral Media for $3.20 billion. This was also the industry’s largest deal in first half 2012, before the initial bid was blocked by regulators.
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.”
As for other industry segments in the report, deal flow in the Internet Media segment decreased seven percent relative to second half 2012. Yahoo!’s acquisition of Tumblr for $1.10 billion was the largest deal ever tracked by Berkery Noyes in the blog subset, surpassing AOL’s acquisition of The Huffington Post for $315 million in 2011.
Volume in the Exhibitions, Conferences, and Seminars segment, after more than doubling between 2011 and 2012, declined 24 percent in first half 2013. The segment’s highest value deal in first half 2013 was Onex Corporation’s acquisition of Nielsen Expositions for $950 million.
A copy of the MEDIA AND MARKETING INDUSTRY M&A REPORT FOR HALF YEAR 2013 is available at the Berkery Noyes website.