US entertainment and media M&A activity has outpaced the overall US deal market in 2010

January 31, 2011 — Fusion DigiNet
  • Content developers remain attractive investments
  • Expect increased activity in video games and social media sectors ample cash available to fuel future M&A

US entertainment and media (E&M) merger and acquisition activity outpaced the overall US deal market in 2010, according to PwC US. With the industry’s fast-paced shift to digital – and attractive levels of corporate cash reserves and private equity dry powder, PwC believes the catalysts are in place for more E&M deal activity during 2011.

In 2010, completed E&M deal volume increased slightly by 3% to 804 transactions, while total completed and disclosed deal value fell from $37.2 billion in 2009 to $33.5 billion in 2010. A primary driver of the increase in deal volume was Internet software & services (B2C) deals. PwC notes an increase in the percentage of announced transactions that did not disclose value, which could have an impact on the actual 2010 value trends. However, despite the decrease in announced deal value, the pipeline for E&M deals in 2011 points to continued improvement and a strong outlook, with more than 200 deals and $24 billion of deal value already announced and pending (including the recently approved NBC Universal joint venture between Comcast and GE).

Total entertainment & media deals by sector

Corporate deal activity remained at the forefront in 2010 with strategic buyers contributing 83% of total deal volume. However, with the decline in reported and completed corporate mega-deals (deals greater than $1 billion), total corporate E&M deal value decreased from 81% of disclosed deal value in 2009 to 59% in 2010.

Private equity solidified its presence within certain E&M subsectors with acquisitions of platform and strategic bolt-ons throughout 2010 (particularly within casinos and gaming, recreation and leisure, publishing and broadcasting). The number of private equity-backed deals increased from 126 in 2009 to 140 in 2010, while their announced value nearly doubled from $6.9 billion in 2009 to $13.7 billion in 2010. PwC sees the potential for an increased appetite for mega-deals by private equity firms.

“With almost $1 trillion of untapped committed capital worldwide, private equity is still primed to make significant acquisitions in the future,” Spiegel continued. “Look for a selection of E&M companies to re-evaluate existing business portfolios and accelerate their divestiture plans, as valuations continue to rebound and interest from private equity intensifies.”

More detail of PwC’s Global Entertainment and Media Outlook: 2010–2014 is available here.

USA, New York, NY

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Oversee.net acquires ShopWiki

January 28, 2011 — Fusion DigiNet

Oversee.net has acquired ShopWiki Corp. The acquisition is the first in the consumer retail space for Oversee’s expanding Vertical Markets division, which is further developing the company’s contextual search and comparative results capabilities to create site experiences that help consumers make purchase decisions.

ShopWiki, founded in 2005 and majority-owned by growth equity firm Generation Partners, has shopping comparison websites serving 11 countries in North America, Europe and Australia.  The sites help users find places to purchase products for sale on the web by intelligently searching and organising nearly half a billion consumer offerings.Oversee establishes retail presenceOversee, which operates successful comparison sites in the travel and financial services sectors like LowFares.com and CreditCards.org, was attracted to ShopWiki because of its potential to serve as a cornerstone of Oversee’s retail presence.  “ShopWiki is the most comprehensive shopping search engine in the market,” said Oversee CEO and President Jeff Kupietzky.  “The acquisition is a perfect fit with our ability to apply our expertise in acquiring and managing Internet traffic to improve comparison and buying decisions for consumers.”

ShopWiki CEO Rory Cumming was attracted to Oversee for similar reasons.  “Oversee provides services for over 10 million domain names and has unique insight into consumer preferences and Internet traffic,” he said.  “Through contextual search, consumers who navigate through Oversee’s network of names will see relevant offers more often with ShopWiki.”Terms of the deal were not disclosed.  Gridley & Company, a New York City-based boutique investment bank, provided ShopWiki Corp. with advisory services on the deal.  Portico Capital Securities LLC served as financial advisor to Oversee.net for the transaction.  Cumming will serve as Oversee’s General Manager, Retail, and will continue to run the property from New York as a wholly-owned subsidiary of Oversee and as a section of Oversee’s Vertical Markets division.

Generation Partners, a $350 million private investment firm, was the company’s largest shareholder and only institutional investor.  “ShopWiki has been a great investment for our firm,” commented John Hawkins, Managing Partner at Generation Partners.  “The company’s proprietary technology proved to be a true differentiator in a competitive market and allowed ShopWiki to grow its top-line revenues at a rate several times that of the overall market.  ShopWiki is one of several successful investments Generation has made in the online advertising and media industries.  Others are Demand Media, an internet-based model for creating high quality, commercially viable content, which recently completed a public offering, and iCrossing, a leading global digital advertising agency which was recently sold to Hearst Corporation.  We continue to focus on this sector and look forward to making several additional investments in the space that capitalize on the same online advertising trends that made ShopWiki so successful.”

“The ShopWiki management team, led by CEO Rory Cumming, has done an outstanding job building the company,” said Louis Marino, Vice President at Generation.  He added, “ShopWiki is an example of Generation’s investment strategy:  we specialize in providing growth capital to exceptional entrepreneurs, focus exclusively on high-growth service businesses and generate our returns through core business growth, rather than through financial leverage.
USA, Los Angeles, CA & New York, NY

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Guild, Newsweek pact clears way for Daily Beast merger

January 28, 2011 — Fusion DigiNet

The Newspaper Guild of New York today announced an agreement that will enable Newsweek magazine to complete its pending merger with the Daily Beast and include a wide range of editorial employees of the website under the existing Guild-Newsweek collective bargaining agreement.

Under the “Framework Agreement” between the Guild and Harman Newsweek LLC, non-supervisory editorial employees who produce the Daily Beast will be covered by the same contract that now covers many of Newsweek’s reporters, editors and other news employees, upon completion of the merger. The agreement was a necessary prelude to the completion of the merger of the two news organisations that was announced December 6, 2010.

“Newsweek’s Guild members are proud to be part of this exciting new venture that will combine the journalistic resources of a venerable news magazine and a cutting-edge news website in an editorial workplace in which all employees will have a voice,” said Guild President Bill O’Meara. “We look forward to working with the operation’s highly respected new editor, Tina Brown, and her team from the Daily Beast as they join with the Newsweek staff to produce high-quality journalism in the digital age.”

The parties agreed to meet within 90 days of the completion of the merger to explore “cost-effective solutions designed to ensure the viability of the Company.”

Under the agreement, Daily Beast employees whose pay is below the minimums set by the Guild-Newsweek contract will be brought up to scale and their seniority will be dovetailed with that of Guild-represented Newsweek employees. The agreement also calls for voluntary buyouts to be offered to certain classes of current Newsweek employees.  Details regarding the buyouts still have to be negotiated.

The Guild, Local 31003 of the Communications Workers of America, represents nearly 3,000 print, photo and video journalists and other employees at 18 New York-area companies, mostly news organisations, including The New York Times, Time Inc., Thomson Reuters, Consumers Union and Standard & Poor’s.

USA, New York, NY

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Ziff Davis acquires LogicBuy.com

January 27, 2011 — Fusion DigiNet

Technology media company Ziff Davis has acquired LogicBuy.com, a provider of tech deals and coupons. Over 10 million visited LogicBuy.com in 2010 seeking the best deals and coupons on a range of technology products and services, including laptops, cameras, TVs and software.

With the acquisition of LogicBuy.com, Ziff Davis websites, such as its flagship PCMag.com, will now be able to provide their audience of in-market buyers the best up-to-the-minute deals and coupons on the products they’re researching. At the same time, LogicBuy.com will tap Ziff Davis’ long-running relationships with tech manufacturers and retailers to bring even more high-quality deals to its audience.

“Between our owned-and-operated websites and our recently launched ad targeting platform, BuyerBase™, Ziff Davis reaches over 40 million tech buyers per month,” said Vivek Shah, CEO of Ziff Davis. “LogicBuy.com gives us the ability to introduce the best deals and coupons to those shoppers and further pursue our mission of informing and influencing tech buyers.”

Launched in 2007, LogicBuy.com was designed to cut through the clutter of overwhelming and often low-quality deals on the Web to present buyers with the best opportunities to save money. LogicBuy.com allows shoppers to find, share and rate every deal and coupon.

“We have saved consumers tens of millions of dollars since our founding,” said Thai Than, founder of LogicBuy.com. “By joining Ziff Davis, we will be able to reach even more buyers with the best possible deals and coupons in technology and consumer electronics.”

USA, New York, NY

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Demand for media IPOs growing – Demand Media and Nielsen shares soar above their IPO prices

January 27, 2011 — Fusion DigiNet

Nielsen Holdings and Demand Media rallied on Wednesday in their trading debuts, signalling that demand for media-related IPOs was building.

Nielsen’s shares rose 8.7 percent from its initial public offering price, and Demand Media’s shares rose 33.2 percent.

Nielsen’s IPO, the biggest of the two, is the first of what is expected to be a rush of big private equity-backed IPOs in 2011. Nielsen raised $1.6 billion on Tuesday, nearly a tenth more than expected.

Read the full story here

USA, New York, NY & Santa Monica, CA

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Yandex has acquired OpenID login service Loginza

January 27, 2011 — Fusion DigiNet

Quintura Blog is reporting that Russian search engine Yandex has acquired OpenID login service Loginza. The deal amount, which was not disclosed, is believed to be less than $1 million.

Loginza offers OpenID protocol-based single login service widget to webmasters and site owners and is used by over 6,500 websites. 

The full story can be read (in Russian) at Yandex blog.

Russia, Moscow

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The Nielsen Company announces the pricing of Its Initial Public Offering

January 26, 2011 — Fusion DigiNet

Nielsen Holdings N.V. has priced its initial public offering of 71,428,572 shares of its common stock at $23.00 per share. The Nielsen Company’s shares of common stock are expected to begin trading today, January 26, on the New York Stock Exchange under the ticker symbol “NLSN.” The Nielsen Company has also priced its concurrent offering of $250 million in aggregate principal amount of mandatory convertible subordinated bonds, which will be mandatorily convertible into shares of The Nielsen Company’s common stock on February 1, 2013. The bonds will bear interest at a rate of 6.25% per annum, and the conversion rate per $50.00 principal amount of bonds will be between 1.8116 and 2.1739, depending on the market value of The Nielsen Company’s common stock, subject to customary anti-dilution adjustments.

In the initial public offering, The Nielsen Company will sell 71,428,572 shares of common stock. The IPO’s underwriters have a 30-day option to purchase up to 10,714,286 of additional shares of common stock from The Nielsen Company at the initial public offering price less the underwriting discount. In the bond offering, The Nielsen Company will sell an aggregate principal amount of $250 million of bonds. The underwriters of the bond offering have a 30-day option to purchase up to an additional $37.5 million in aggregate principal amount of bonds from The Nielsen Company at the initial public offering price less the underwriting discount.

The Nielsen Company will receive net proceeds of approximately $1,560 million from the initial public offering of its common stock and approximately $240 million from the bond offering after payment of commissions and estimated expenses. The Nielsen Company intends to use the proceeds to repay a portion of its outstanding indebtedness and to pay an advisory agreement termination fee to its current owners.
J.P. Morgan, Morgan Stanley, Credit Suisse, Deutsche Bank Securities, Goldman, Sachs & Co. and Citi are serving as joint book-running managers for both offerings, with BofA Merrill Lynch, William Blair & Company, Guggenheim Securities, Wells Fargo Securities, Blaylock Robert Van, LLC, HSBC, Loop Capital Markets, Mizuho Securities USA Inc., Ramirez & Co., Inc. and The Williams Capital Group, L.P. are acting as co-managers.

USA, New York, NY

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Google-owned YouTube has acquired fflick

January 26, 2011 — Fusion DigiNet

 

Google-owned YouTube has acquired fflick, a business founded by former Digg employees and which uses Twitter to power a movie sentiment and recommendation engine, for around $10 million.

The announcement on YouTube reads:

Share and share a like: we’ve acquired Fflick

Many of the YouTube videos you watch and love are also shared on sites beyond YouTube.com. Our site is built, in part, on social tools like comments, video responses and ratings. In recent years we’ve worked to integrate these social signals across other popular social platforms. For example, we see more than 400 tweets per minute containing a YouTube link, and over 150 years worth of YouTube video is watched on Facebook every day.

We’ve always believed that there are great conversations happening all the time off of YouTube.com, and that commentary has the potential to enrich your experience when watching and discovering video on YouTube itself. So today we’re excited to announce we’ve acquired Fflick, a talented team that analyzes social media data to surface great content and the discussions around it.

We were impressed by the technical talent, design instincts and entrepreneurial spirit of the Fflick team. As part of YouTube, the Fflick team will help us build features to connect you with the great videos talked about all over the web, and surface the best of those conversations for you to participate in.

USA:

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Google acquires SayNow

January 26, 2011 — Fusion DigiNet

Logo_reinventing

Nikhyl & Ujjwal, co-founders of SayNow, have announced on the SayNow website that the company has been acquired by Google. SayNow has developed a platform, which allows voice messaging, one-on-one conversations, and group calls. It is for the celebrities that use the SayNow service. the announcement is below:

We are thrilled to announce that we have been acquired by Google.

Since 2005, we’ve explored fun and entertaining ways for people to talk with each other. Through the web, smartphones, and even land lines, our products brought communities together through the power of voice. And as Google has some of the best voice products in the world, we believe combining forces with the Google Voice team will let us innovate in new and unexplored areas.

We have no specific product plans to announce at this time, but we’ll have more to say about our roadmap as we integrate with Google, so stay tuned. We couldn’t be more excited about what is yet to come.

USA, Palo Alto, CA

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Reply.com acquires web properties

January 26, 2011 — Fusion DigiNet

Reply.com, the auction marketplace for the acquisition of locally-targeted and category specific customer prospects, has acquired numerous web properties to further support and broaden its reach in the real estate and home improvement categories. Among the websites acquired are FastRoofingBids.com, FastRoofingLeads.com, and LeadToRealty.com.

FastRoofingBids.com and FastRoofingLeads.com’s high organic search engine ranking helps Reply.com further improve its presence in one of the major trades within the home improvement industry.

“As we continue to grow organically, acquisition opportunities play an important role in further scaling our presence within our existing verticals as well as emerging categories,” said Reply.com Founder and CEO Payam Zamani. “In our quest to maximize liquidity in our auction marketplace for locally-targeted traffic, we will continue to target assets that deliver new sources of traffic, bring new advertisers to Reply.com, or allow us to expand into new categories.”

USA, San Ramon, CA

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