Fusion Corporate Partners

Berkery Noyes, an independent mid-market investment bank, has released its first half 2012 mergers and acquisitions trend report for the Media and Marketing Industry.

The report analyzes merger and acquisition activity in the Media and Marketing Industry for the first half of 2012 and compares it with activity in the four previous six-month periods from 2010 to 2011.

Total transaction volume increased six percent during the last six months, from 784 transactions in second half 2011 to 834 in first half 2012. Meanwhile, total transaction value increased 27 percent, from $24.88 billion to $31.51 billion. Despite this uptick, median enterprise multiples in the industry decreased. The median revenue multiple fell from 1.8x to 1.2x and the median EBITDA multiple declined from 10.0x to 7.8x. However, three segments had median revenue multiples of at least 2.0x: B2B Publishing, Broadcasting, and Exhibitions, Conferences, and Seminars.

Marketing was the most active industry segment for first half 2012, accounting for 262 transactions and surpassing Internet Media in transaction volume during the last twelve months. Although Internet Media activity declined two percent compared to second half 2011, it remained 19 percent above its second half 2010 levels. In the Marketing segment, 47 percent of deals were Digital Marketing transactions, which represented a 10 percent improvement on a half-to-half year basis. WPP Group was the largest acquirer in the Digital Marketing sub-segment as well as the overall Media and Marketing Industry.

The segment with the largest rise in volume in first half 2012 was Exhibitions, Conferences, and Seminars with an 85 percent increase. The median revenue multiple in the segment also increased 26 percent relative to first half 2011, from 1.9x to 2.4x.

Consumer Publishing M&A rose 13 percent, improving for the third consecutive half year period. The segment was led in first half 2012 by Berkshire Hathaway’s acquisitions of Waco Tribune Herald, The Bryan College Station Eagle, and 63 daily newspapers from Media General. In addition, the B2B segment was responsible for three of the top nine deals by value and underwent a 10 percent increase in transaction volume.

M&A volume in the Entertainment segment increased for the fourth straight half year, growing 24 percent in first half 2012. The largest related transaction in first half 2012 was Lionsgate’s acquisition of Summit Entertainment for $700 million. Video games, a sub-classification of Entertainment, rose 30 percent in first half 2012 and accounted for 62 percent of the segment’s deals. There was also a 50 percent increase in social gaming transactions during the last six months. The most notable social gaming deal by value was GREE International’s announced acquisition of Funzio, a mobile game developer, for $210 million.

“As we predicted in the press release for our first quarter report, there has been an impressive increase in M&A pertaining to social gaming,” said Evan Klein, Managing Director at Berkery Noyes. “Of the many possible means of monetizing social games, enticing users to purchase virtual currency and other rewards continues to be the most lucrative model for generating revenue.”

A copy of the FIRST HALF 2012 MEDIA AND MARKETING INDUSTRY M&A REPORT is available here.

Related articles:

• Berkery Noyes releases 2011 year-end Financial Technology & Information Industry M&A Acquisitions Report Posted on January 18, 2012
• Berkery Noyes releases 2011 year-end Online & Mobile Industry M&A Report Posted on January 18, 2012
• UK private equity investment in the £10M-£10OM market grows by 44% Posted on January 18, 2012
• Berkery Noyes Releases 2011 Year End Online & Mobile Industry Mergers and Acquisitions Report posted on January 12, 2012
• Berkery Noyes releases 2011 Year End Media Trends Report Posted on January 10, 2012
• AdMedia’s Industry Survey – 2012 Mergers and Acquisitions Prospects for Media, Marketing Services and Related Technology Firms Posted on January 10, 2012
• mergermarket Q3 Monthly M&A Insider report Posted on November 2, 2011
• Berkery Noyes releases third quarter 2011 M&A Update for the Media & Marketing Industry Posted on October 26, 2011
• Quarterly analysis of UK-headquartered private equity control deals in the £10 million to £100 million segment Posted on October 5, 2011
• Half Year Mergers and Acquisitions Trends Report for Private Equity in the Information Industry Posted on August 1, 2011
• Half Year M&A Trends Report for the Financial Technology and Information Industry Posted on July 19, 2011
• Berkery Noyes releases its Half Year M&A Trends Report for the Online & Mobile Industry Posted on July 18, 2011
• Survey of Private Equity fund managers indicates improved optimism – Rothstein Kass’s Private Equity in 2011 report Posted on May 30, 2011
• Internet Advertising Revenues Hit $7.3 Billion in Q1 ’11 Highest First-Quarter Revenue Level on Record According to IAB and PwC Posted on May 30, 2011
• VC Funding in the solar sector off to a Strong Start With Q1 Coming in at $658 Million From Mercom Capital Group – April 12, 2011
• UK Buyout market registers strongest quarter in two years From Lyceum Capital and Cass Business School’s UK Growth Buyout Dashboard – April 8, 2011
• JEGI releases its Media and Information M&A report for Q1 2011 – From Jordan Edmiston Group’s Media and Information M&A report – April 1, 2011
• Investments in green companies and technologies globally now total more than $2 trillion – From Ethical Markets Media‘S The Green Transition Scoreboard – February 22, 2011
• Market Research Report – 2010 Private Equity in the Information Industry Merger & Acquisition Trends – Valuation Metrics up 53% from 2009 – From Berkery Noyes Private Equity in the Information Industry M&A Trends Report – February 4, 2011
• US entertainment and media M&A activity has outpaced the overall US deal market in 2010 – From PwC US – January 31, 2011
• US Financial Technology & Information Industry M&A trends report shows deal value has grown by 27% since 2009 – From Berkery Noyes  2010 Financial Technology & Information M&A Trends Report – January 19, 2011
• Research shows smaller buyouts bounce back in 2010 – From Lyceum Capital and Cass Business School’s UK Growth Buyout Dashboard – January 11, 2011
• US information industry M&A report shows deal value and volume Up 36% – From Berkery Noyes 2010 Information Market M&A Trends Report – January 7, 2011