AdMedia’s Industry Survey – 2012 Mergers and Acquisitions Prospects for Media, Marketing Services and Related Technology Firms

January 10, 2012 — Fusion DigiNet

AdMedia Partners has released its latest industry survey, “2012 Mergers and Acquisitions Prospects for Media, Marketing Services and Related Technology Firms.’

The report reveals the viewpoints of buyers and sellers regarding 2012 valuations, advertising spending, M&A activity, and key trends affecting all industry participants, such as the changing nature of content delivery, consumption and monetization.

Respondents were generally optimistic about prospects for their industries and their own businesses in the year ahead, and expect that strong M&A activity in 2011 will continue into 2012. They believe there will be an increase in M&A activity driven by strategic buyers with historic amounts of cash on their balance sheets, private equity firms with large amounts of uninvested capital and changing industry dynamics.

Specific survey findings include:

  • Fifty-nine percent of respondents expect to seek an acquisition, up markedly from last year when 40% had the same expectation.
  • Highlighting the fact that significant capital is sitting on the sidelines, 55% of respondents who anticipate making an acquisition expect to fund using existing cash reserves; in addition, 43% expect to raise outside equity (e.g., from a private equity firm) and 27% plan to use debt financing.
  • Almost half of respondents (48%) anticipate contemplating the sale of their company and/or subsidiary operation in 2012, a significant increase over the 36% who expressed this opinion in 2011.
  • Approximately three out of four respondents anticipate that M&A by strategic buyers will be up in 2012.
  • Almost half of respondents anticipate that M&A by financial buyers will be up in 2012.
  • The most popular areas of expansion interest within the services sector were analytics, social and mobile. User-generated content and mobile were hottest topics for content respondents.
  • Respondents predict that valuations will remain strong in 2012, particularly for mobile marketing, social marketing, and digital media firms.

Visit the AdMedia Partners website to download a full copy of the report.

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Wolters Kluwer Health acquires Medknow

December 7, 2011 — Fusion DigiNet

Wolters Kluwer Health has acquired Medknow PVT Ltd., a Scientific, Technical & Medical journal publishing operation headquartered in Mumbai, India and one of the largest open access publishers in the world. Terms of the deal were not disclosed.

“Research is changing in the developing world with clinicians and researchers looking for more access to locally-written content that is peer-reviewed and accessible via open platforms,” said Karen Abramson, President & CEO, Wolters Kluwer Health, Medical Research. “Our acquisition of Medknow aligns with our strategy of continuing to invest in providing the latest, most trusted information to our customers around the world to help them fuel discoveries and enhance patient care.”

Founded in 1977, Medknow has a strong portfolio of more than 155 journals and offers much of its content electronically. The company has strong market share among journals published in India and also has a growing presence in Asia Pacific and the MEA region. In addition to its print and electronic journal content, the company provides an electronic peer-review system for authors and editors, ensuring high quality clinical research. The deal will enable Wolters Kluwer Health to accelerate advances in the open access arena. It also furthers the company’s growth strategy of continued investment in international expansion in key emerging markets across the globe.

USA, Philadelphia, PA & India, Mumbai

 

 

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Publicis Groupe acquires Gomye

December 7, 2011 — Fusion DigiNet

Publicis Groupe has acquired 100% of Gomye, a full service digital agency providing integrated and interactive marketing services, with offices in Beijing as well as Chengdu and Chongqing, two rapidly growing major cities in western China. Gomye will be rebranded to become Publicis Modem Beijing (the digital arm of Publicis Worldwide in Beijing) and Publicis Modem Chengdu. The agency’s 51 staff members will be folded into Publicis’ local team. Its CEO, Alan Yang, will become Managing Director of Publicis Modem Beijing and Publicis Modem Chengdu, and will report to the CEO of Publicis Beijing.

Coupled with the acquisition of Shanghai agency Wangfan earlier this month, the acquisition of Gomye, which remains subject to the approval of the relevant authorities, further emphasizes Publicis Worldwide’s strong commitment to building leading digital capabilities across China.

Founded in 2003, Gomye’s superior digital expertise, coupled with its leading position in Chengdu and Chongqing, ideally place the agency to benefit from the strong growth potential of China’s most important western cities. Following a period of investment in the coastal metropolises of Beijing, Shanghai and Guangzhou, China’s 2011-2016 Five Year Plan, approved inMarch 2011, gives priority focus to developing the country’s vast interior. Chengdu – the capital city of Sichuan province — and its sister city Chongqing are among the economic, transportation and communications hubs designated for massive investment and rapid growth. Gomye’s clients includes Vanke Real Estate (China’s largest residential developer), movie and media company Huayi Brothers Media Group, liquor company Wuliangye Yibin, China Mobile and China Telecom.

This is the latest in a series of China agency acquisitions for Publicis Groupe that includes Wangfan (November 2011), Genedigi (June 2011), Dreams (May 2011), Interactive Communications Ltd (February 2011), and Eastwei Relations (November 2010).

“Acquiring Gomye is a particularly important move for us. It not only further strengthens our digital capabilities in Beijing but also gives us the critical ability to offer our clients significant digital expertise in the booming cities of Chengdu and Chongqing” commented Jean-Yves Naouri, Publicis Groupe COO and Chairman of China Publicis Groupe.

France, Paris & China, Beijing

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Hearst Corporation completes the acquisition of the majority of Hachette China operations

December 6, 2011 — Fusion DigiNet

Hearst Corporation has completed the acquisition of the majority of the Hachette China operations. The remaining operations, which include a joint venture with Marie Claire, are expected to conclude in the near future. This will mark the final portion of Hearst’s overall transaction with Lagardère SCA to acquire the company’s nearly 100 titles in 14 countries outside of France, including the U.S.

The acquisition includes most of Hachette’s magazine-related activities in China and oversight of seven titles, including global media superbrand ELLE, as well as Car and Driver, Woman’s Day andPsychologies.

In a joint statement, Hearst Corporation CEO Frank A. Bennack, Jr., and Duncan Edwards, president and CEO, Hearst Magazines International, said, “We’re very pleased to have finalized our acquisition in China and look forward to working with our Chinese publishing partners to produce great magazines and expand our existing portfolio of brands in this very important market.”

As a result of the transaction, Hachette China will change its name to Hearst Magazines China effective immediately.

USA, New York and China, Beijing

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Renren sells online travel booking business eLong to Expedia

November 21, 2011 — Fusion DigiNet

Chinese social networking internet platform Renren has sold its investment in online travel booking business eLong to Expedia for approximately $72.4 million, or $23 per ADS.

“We’re pleased to have an opportunity to increase our investment in eLong as we see China as a key market in our efforts to expand internationally,” said Dara Khosrowshahi, President and Chief Executive Officer of Expedia. “We have been very happy with the strategic and operational progress made by eLong and look forward to many more years of success.”

“Our early investment in eLong helped us build mutually beneficial commercial ties as well as generate strong returns for our shareholders. Renren and eLong will continue to work on a number of joint initiatives, including Nuomi hotel group-buy, one of the largest hotel group-buy sites in China. We will continue this strong relationship with eLong and deliver more popular products together moving forward,” commented Joseph Chen, Chairman and Chief Executive Officer of Renren.

“Renren will continue to be a valued business partner to us, and we look forward to future cooperation with Renren,” said Guangfu Cui, eLong’s Chief Executive Officer.

China, Beijing

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Rakuten to Acquire Kobo US$315 million in cash

November 9, 2011 — Fusion DigiNet

Rakuten is to acquire Kobo for US$315 million in cash. The transaction is expected to close in Q1 2012.

Kobo was founded by and spun out of Indigo, the largest book, gift and specialty toy retailer in Canada, in December, 2009. Since that time, Kobo has become a fierce competitor in the eBook marketplace, with a family of innovative eReaders, a wide range of eReading apps, one of the largest eBook catalogues, an innovative social platform and retail partners around the globe.

The acquisition marks a major step forward for Rakuten, one of the world’s top 3 e-commerce companies by revenue, as it continues to expand its B2B2C borderless e-commerce business globally, by adding an ecosystem to provide downloadable media products to consumers, starting with eBooks.

Hiroshi Mikitani, Chairman and CEO of Rakuten, commented on the acquisition, “We are very excited about this next step. Kobo provides one of the world’s most communal eBook reading experiences with its innovative integration of social media, such as Facebook and Twitter; while Rakuten offers Kobo unparalleled opportunities to extend its reach through some of the world’s largest regional e-commerce companies.

Upon closing the acquisition, Kobo will continue to maintain its headquarters, management team and employees based in Toronto, Ontario.

Japan, Tokyo & Canada, Toronto

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Publicis Groupe acquires Chinese digital agency Wangfan

November 2, 2011 — Fusion DigiNet

Publicis Groupe has acquired Wangfan, an innovative digital agency based in Shanghai that focuses on piloting interactive campaigns, web branding, and the conception and design of websites.

Founded in 1997, Wangfan was among the first digital agencies in China, and has won numerous creative awards. The agency has seen rapid revenue growth in recent years, with a 19% increase in 2010 over 2009 and a projected 16% increase in 2011. Its clients include Puma and Shanghai General Motors, alongside a broad range of other international and Chinese companies.

Wangfan will be rebranded to become part of Publicis Modem Shanghai, the digital arm of Publicis Shanghai, and Wangfan CEO Bill Wang will become Managing Director of Publicis Modem Shanghai. Wangfan’s 61-person team will provide a fresh boost to Publicis’ local skill-set in the surging digital market. According to ZenithOptimedia, ad expenditure rose by 25.3% in China in 2010. Further double-digit growth is expected through 2013, driven specifically by Internet advertising, whose share of total spend will rise from around 18% in 2010 to 25% by the end of 2013.

The acquisition of Wangfan, which remains subject to the approval of the relevant authorities, is another step towards Publicis Groupe’s objective of doubling its size in the fast-growing Chinese market between 2010 and 2012. This goal is part of an overall strategy of strongly boosting revenue derived from emerging economies and from the digital sector. In the past twelve months the Groupe has acquired Chinese agencies Genedigi (June 2011), Dreams (May 2011), Interactive Communications Ltd (ICL) (February 2011), and Eastwei Relations (November 2010). In terms of organic growth (not including acquisitions and foreign exchange movements), China was one of eleven countries where the Groupe’s growth hit double digits in the first half of 2011.

Jean-Yves Naouri, Publicis Groupe COO and Chairman of China Publicis Groupe, commented, “China is a core priority for us. It’s a market where we aim to be perceived as essential interlocutors. Wangfan is a superb agency with a talented and fast-moving team. They began as pioneers and they have kept moving ahead of the creative and technological wave in the ongoing digital boom. We’re pleased to welcome them to our team in Shanghai.”

“Through this acquisition, Publicis Shanghai is able to integrate more talents and resources, and to offer our clients more services,” added Chenghua Yang, Managing Director of Publicis Shanghai.

France, Paris & China, Shanghai

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mergermarket Q3 Monthly M&A Insider report

November 2, 2011 — Fusion DigiNet

According to the mergermarket Q3 Monthly M&A Insider report (October 2011), global m&a in the first three quarters of 2011 totalled us$1,718bn – a 21.5% increase from the us$1,414.4bn worth of deals registered in the first three quarters of 2010 – and the financial services sector saw an even steeper 37.4% increase during this nine-month window. The first three quarters of 2011 brought us$208.5bn in financial services deals to market, up from us$151.7bn in the same period last year,

Sectors covered by Fusion DigiNet

The largest sector by market share was Energy, Mining and Utilities at 23.1% (835 deals) down 10% (-125 by volume), in 7th place is Business Services at 4.4% (1,159 deals) -17% (+62 by volume), media is in 8th place at 1.9% (279 deals) +23% (no change by volume).

See the full report at mergermarket

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Rakuten to acquirie Play.com for approximately £25M

September 22, 2011 — Fusion DigiNet

Rakuten is acquiring UK e-commerce site Play.com for approximately £25 million in cash. The deal is expected to close early in October.

The acquisition represents a significant step in Rakuten’s continued European and Global expansion and marks the company’s third acquisition in Europe, joining French e-commerce pioneer PriceMinister, acquired in 2010, and the rapidly expanding German online shopping mall, Tradoria, which joined the Rakuten Group in July of this year. Rakuten now operates e-commerce businesses in ten countries globally, including Japan.

Hiroshi Mikitani, Chairman and CEO of Rakuten, commented on the acquisition, “The UK market is one of Europe’s largest and most mature e-commerce markets. Play.com is not only a pioneer in the market, but also one of the UK’s most successful e-commerce businesses. We aim to leverage our e-commerce strength and experience to further expand and develop Play.com’s business model and channel its loyal user base, merchants, and deep product offerings into Rakuten’s global e-commerce network.”

Japan, Tokyo and UK, Cambridge

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MyHeritage.com has acquired BackupMyTree

September 20, 2011 — Fusion DigiNet

MyHeritage.com has acquired BackupMyTree, a free and automatic backup service for family tree data. This is the sixth acquisition by MyHeritage.com. Terms of the deal were not disclosed.

The BackupMyTree backup service, which was only launched one year ago,  protects more than 9 TB of family tree data. MyHeritage.com will continue to maintain the service and keep it free.

“As the leading international destination for families to explore their history, share memories and keep in touch, we understand the enormous value users place on protecting their family tree data,” said Gilad Japhet, founder and CEO of MyHeritage.com. “We believe that BackupMyTree’s cutting edge client-to-cloud technology has massive potential and share its mission of preserving family history, making this a natural and synergistic move for us. We look forward to continuing to provide an excellent free backup service and exploring ways for BackupMyTree to benefit existing MyHeritage.com users and vice versa.”

BackupMyTree is the second company that MyHeritage.com has purchased from serial entrepreneur Cliff Shaw, having acquired Pearl Street Software, makers of GenCircles.com and Family Tree Legends, in 2007. MyHeritage.com continues to run both GenCircles.com and Family Tree Legends, and has made the Family Tree Legends software and record collection free.

USA, Boulder, CO & UK, London & Israel, Tel Aviv

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