Mergers and acquisitions activity within the marketing communications sector has been ‘remarkably resilient’ according to Results International, which completed nine global deals worth $200m in the last eight months.
Four of the deals were completed in January 2012 alone, with Flip Media being bought by Publicis, The Upper Storey being acquired by Isobar (Aegis), CIC being bought by Kantar Media (WPP) and Crayon’s sale to Karma Communications (backed by Phoenix Equity Partners).
Another two deals, Plus Incite and Plus Bridgehead, were completed in late February/early March.
According to Results International, this activity is of a similar value to the same period last year (December 2010 – January 2011).
Keith Hunt, managing partner of Results International, said: “We see no slowdown in the number of deals being done, in fact quite the contrary. This is supported by some of the leading global networks who have openly communicated details of the sizeable reserves they have allocated for M&A activity in the year ahead.
“What’s more, private equity continues to have a healthy interest in the sector and the necessary funds as the recent Crayon deal backed by Phoenix Equity Partners demonstrates.”
The company has also revealed the identities of a number of new buyers looking to make acquisitions within the marketing communications and technology sectors, including St Ives (which bought Response One, Pragma and Incite), luxury shopping site Kelkoo Select, members club Keynoir, semantic analysis club LikeCube. Meredith also bought a stake in iris, leading to iris Worldwide’s announcement of a new global creative network, The Financial Times bought web app developer Assanka and Trinity Mirror acquired mobile/online company Communicator Corp for £8m.
“Traditional media companies have seen the writing on the wall for a while now. Those with the resources as well as the foresight to do so are quickly buying into the skill sets that they feel will best future-proof their businesses and support the re-engineering that will be required to ensure survival,” added Keith Hunt.
“More interestingly, while in the past, businesses of this kind might have relied on specialist agencies to support their ambitions, they are now buying-in the required skill sets directly in an effort to move up the learning ladder. Specialist businesses with the right IP and technology offer, will find that there are some very deep pockets willing to invest in their future.
“This year the big money is on social and mobile commerce, big data and data analytics and geo-targeting technologies – especially in light of the opportunities that the Olympics present to brands. Groupon-style businesses who can offer bargain-hungry consumers added value are also likely to remain hot, as Time Out’s growing portfolio demonstrates,” he concluded.
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