Berkery Noyes releases 2011 Year End Media Trends Report

January 10, 2012 — Fusion DigiNet

2011 Key Highlights

  • The largest announced transaction for 2011 was West Australian Newspapers’ acquisition of Seven Media Group, a portfolio company of Kohlberg Kravis Roberts & Co., for $4.15 billion.
  • The segments with the largest disclosed median enterprise value multiples for 2011 were Broadcasting with 3.8x revenue and Internet Media at 17.5x EBITDA.
  • There were 174 fi nancially sponsored transactions with an aggregate value of $11.05 billion, representing 12 percent of the total volume and 20 percent of the total value, respectively.

2011 Key Trends

  • Total transaction volume in 2011 increased by 15 percent over 2010, from 1225 in 2010 to 1409 this year.
  • Total transaction value in 2011 increased by 41 percent over 2010, from $38.31 billion in 2010 to $54.12 billion this year.
  • The median revenue multiple rose from 1.5x in 2010 to 1.9x in 2011. The median EBITDA multiple moved slightly from 10.4x to 10.6x.
  • The segment with the largest increase in volume in 2011 over 2010 was Marketing with a 29 percent increase from 332 transactions in 2010 to 428 transactions in 2011.

M&A Market Overview

  • Berkery Noyes tracked 3572 transactions between 2009 and 2011, of which 1013 disclosed fi nancial terms, and calculated the aggregate transaction value to be $119.95 billion. Based on known transaction values, we project the value of the 2550 undisclosed transactions to be $25.33 billion, totaling $145.27 billion worth of transactions tracked over the past three years.
  • The largest transaction tracked by Berkery Noyes between 2009 and 2011 was Comcast Corporation’s acquisition of NBC Universal, a subsidiary of General Electric Company for $22.85 billion, which was announced in 2009 and closed in 2011.
  • The most active acquirer by volume in the Media and Marketing industry between 2009 and 2011 was Publicis Groupe SA with 39 transactions, 24 of which were announced or closed in 2011.

Visit the Berkery Noyes website to download the full report

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Hustler Acquires Sapphire Media

January 10, 2012 — Fusion DigiNet

Adult entertainment media business Hustler has acquired Sapphire Media, a European distributor of adult content to television, VOD and wireless devices. The new parent entity for Sapphire Media is LFP Media BV.

Sapphire Media International BV distributes 7 adult channels across Europe, including Blue Hustler, Hustler TV, HustlerHD/3D and Daring!TV to over 900 distribution partners. It is a provider of adult content to IPTV, VOD and mobile operators. The company is headquartered in Amsterdam.

“We started working with Sapphire to bring Hustler TV to Europe back in 2005 and within a month we were the mostly widely distributed adult network there thanks in a large part to their efforts,” said Michael H. Klein, President, Hustler. “Based on our strong relationship with them and the prospects for future growth, we felt bringing the Sapphire team on board full time as part of our Broadcasting Group was the smartest move for us.”

USA, Beverly Hills, CA & The Netherlands, Amsterdam

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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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A Fusion Deal : Energy specialist Utilyx sold to MITIE Group

January 10, 2012 — Fusion DigiNet

Fusion Corporate Partners are pleased to announce our first deal of 2012. The sale of leading energy and carbon management specialist Utilyx Holdings Limited to MITIE Group PLC, the strategic outsourcing and energy services company.

Utilyx provides a number of services relating to its clients’ energy demands including strategic planning, procurement and risk management, all of which are designed to manage the business impact of energy consumption and rising energy costs.

The acquisition of Utilyx will complement and enhance MITIE’s existing CarbonCare energy services capabilities. The energy services market is significant for MITIE, with 35% of the Group’s revenues derived in this area. MITIE is ranked as the second largest energy services company in the UK, providing a full range of integrated services that help its clients manage their energy use and carbon footprint. MITIE’s energy services proposition supports all the key energy issues facing businesses and public sector organisations across the UK. These include business continuity through security of energy supply, value through cost reduction, reduction of carbon emissions and renewable energy.

As a leading consultant on corporate carbon and energy strategy, Utilyx counts a range of major UK energy users among its clients, from the industrial, commercial and public sectors. Utilyx has excellent high-level working relationships with numerous blue-chip companies including Scottish Water, Iceland and McDonald’s. It has excellent strategic relationships across the fast-growing energy services market and also provides specialist services to generators and developers of renewable energy projects.

Established in 2000, Utilyx purchases a significant proportion of the UK corporate energy market on behalf of its clients. The business has a deserved reputation for excellence and innovation, having introduced a number of new products and concepts to the market, including flexible risk managed electricity purchasing, open-book agreements and end-user Power Purchase Agreements.

Utilyx has annualised revenues of over £7m and is well placed to support MITIE’s progress in the growing energy services market in the UK. The total consideration for the acquisition will be up to £16.2m. Initial consideration of £15m was paid in cash on completion and the balance (capped at a maximum additional payment of £1.2m) will be paid in cash, dependent on future business performance. The proforma EBITDA of Utilyx is £1.7m and it is expected the acquisition will be earnings neutral in the first year of ownership.

Ruby McGregor-Smith CBE, Chief Executive, MITIE Group PLC, commenting on the transaction, said: “We are delighted to have acquired Utilyx. There is no doubt that the need for all organisations to use fewer natural resources is changing our marketplace. Energy management is integral to what we do and this acquisition forms part of our considerable investment to further develop MITIE’s energy services capability.

Chris Bowden, Chief Executive Officer of Utilyx added: “We are excited by the opportunity this presents for us and our clients. The energy sector is fast-moving and by bringing together our expertise and experience, we will be in an even stronger position to help our clients meet the challenges and opportunities that the new low-carbon economy .

Paul Kelly, Director at Fusion, said “We were delighted to work with Chris and his team at Utilyx. They have built a great business and the fit with MITIE is excellent. The energy services sector has become an important part of the Fusion business. This our sixth energy services deal. Besides private equity interest, we are seeing an increase in acquisition interest from large energy management, FM, environmental services and building services companies. We expect to continue to be active in the sector for some time to come.”

Previous Fusion energy services deals:

UK, London & Bristol

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Other Fusion Deals:

Media and Information

Events, Broadcast and Other deals
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Trinity Mirror acquires email marketing business Communicator Corp for £8 million

January 9, 2012 — Fusion DigiNet

Trinity Mirror has acquired email marketing business Communicator Corp for £8 million. The company was acquired from a number of shareholders including the Managing Director, Chris Wilds who will be retained in the business. The company reported revenues of £3.5 million and operating profit of £1.0 million in its latest reported accounts to the year ended 31 March 2011 and had gross assets of £1 million. Communicator Corp is based in Sunderland.

This acquisition furthers Trinity Mirror’s aim to build a network of digital marketing services businesses. In 2008 Trinity Mirror acquired Rippleffect, a digital marketing services specialist offering website design and development, e-commerce, social media and on-line advertising. Communicator Corp complements the Rippleffect business by adding email and mobile communications to the services currently offered.

Sly Bailey, CEO Trinity Mirror PLC said: “Increasingly we’re seeing that, in addition to print and website advertising, clients want help in areas such as website design, search engine optimisation, e-mail marketing, social media and web analytics. The addition of Communicator Corp to our stable of digital assets will enhance our offering and complement the digital marketing services currently offered by Rippleffect.

UK, London and Sunderland

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Deloitte acquires Übermind

January 9, 2012 — Fusion DigiNet

Deloitte has acquired Übermind, an innovative mobile agency.  Terms of the deal were not disclosed.

“Mobile technologies are rapidly reshaping the nature of business. This represents a significant opportunity for companies to develop new interaction models with customers, employees and stakeholders,” says Janet Foutty, national managing director, technology, Deloitte Consulting LLP.

Based in Seattle, Wash., Übermind’s mobile strategy, engineering, design and creative talent transform the way companies use mobile solutions, using disruptive technologies to create inspiring and intuitive mobile applications designed to both strengthen brand and transform the business. Übermind complements Deloitte with extraordinary talent, tools and assets that are customized to the mobile development lifecycle, including proprietary frameworks and methodologies.

“By leveraging the strength of Deloitte’s global access, industry insight and deep talent, this acquisition allows us to provide even greater insight into the business and technology issues facing organizations today,” says Shehryar Khan, chief executive officer of Übermind, Inc. “Übermind’s complementary industry footprint enhances our collective ability to deliver tailored solutions to meet clients’ specific needs.”  Khan, along with Übermind founder Donald Brady, joins Deloitte Consulting LLP as principals.

For more information here

USA, Seattle, WA

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BSkyB invests in Zeebox

January 9, 2012 — Fusion DigiNet

British Sky Broadcasting has become an investor in zeebox, a ‘second-screen’ consumer service that brings together broadcast TV and the Internet. Sky has taken a 10% equity stake, providing funding to support the company’s future product roadmap and global rollout plans. As part of the deal Sky Media will become the exclusive advertising sales agent for zeebox’s synchronised advertising inventory. zeebox remains an independent company continuing to operate its own zeebox branded social TV platform in the UK and elsewhere. It will continue to deliver a second-screen platform that broadcasters and programme-makers can use to support and enrich their shows, connect with fans, and obtain new insights into viewer behaviour. Terms of the deal were not disclosed.

The zeebox service – currently available on iPhone, iPad and the Web – serves up social media feeds and conversations via Twitter and Facebook, as well as additional information on the topics, people and products featured within specific programmes. Consumers use these ‘zeetags’ to search the web for more information, read up on characters or actors, purchase music, buy products featured on-screen – whether during programmes or ad breaks, or simply share their views with friends and followers on social media. The service will be offered to Sky customers

From later this year, Sky customers will also be able to use a zeebox powered Sky app to access their Sky+ box on the move, so they can manage their Sky+ recording remotely, as well as using their iPhone or iPad as a remote control for their Sky box.

UK, Isleworth, Middlesex

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Safari Books Online acquires web developer Threepress

January 9, 2012 — Fusion DigiNet

Safari Books Online, the on-demand digital library for technology, digital media and business professionals, has acquired Massachusetts-based Threepress Consulting Inc, makers of the Ibis Reader online EPUB reading system. The acquisition, was completed on January 1, 2012. Terms of the deal were not disclosed.

As part of the acquisition, Threepress co-founders Liza Daly and Keith Fahlgren and the rest of the Threepress staff will join the Safari Books Online engineering team, working from their East Coast and Bay Area locations. Daly will become the VP of Engineering while Fahlgren will assume the role of Director of Engineering.

“This acquisition is a critical step in support of all three of Safari Books Online’s key strategic initiatives: growing and strengthening our base business; developing new products and new markets; and developing truly new ways of learning online,” explained Andrew Savikas, CEO, Safari Books Online. “The Web is a very different (and much more mobile!) place than it was more than 10 years ago when Safari Books Online opened its virtual doors. These phenomenal additions to our team will help us make sure Safari Books Online will continue to be at the forefront of online reading and learning for the next 10 years and beyond.”

USA, Sebastopol, CA & Massachusetts, MA

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NetMediaEurope acquires German arm of CBS Interactive

January 9, 2012 — Fusion DigiNet

CBS Interactive has sold its German IT websutes ZDNet.de, silicon.de and CNET.de to NetMediaEurope, publisher of ITespresso.de,Gizmodo.de and Channelbiz.de. Terms of the deal were not disclosed. The combined entity will see close to 20 million page impressions per month, and five million unique users. The two companies will merge their Munich operations, with all six websites coming under the NetMediaEurope brand.

Dominique Busso, CEO of NetMediaEurope, commented: “We have established a strong brand across Europe, and aim to provide a one-stop shop for advertisers and sponsors looking for innovative opportunities to reach out to target audiences.” He continued: “This acquisition makes NetMediaEurope one of the key tech players in Germany, and will provide our international client base with powerful advertising reach.”

NetMediaEurope publishes in the UK, Germany, France, Italy and Spain, and was founded in July 2007 as a result of an MBO by senior VNU managers.

Germany, Munich

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Shine Group acquires ChannelFlip

January 9, 2012 — Fusion DigiNet

Elisabeth Murdoch’s Shine Group has acquired ChannelFlip the online broadcaster and original content producer. ChannelFlip’s programming includes Richard Hammond’s Tech Head, David Mitchell’s Soapbox and Dom Joly’s Joystick. ChannelFlip, was founded in 2008 by Justin Gayner and Wil Harris.

Elisabeth Murdoch, the CEO and chairman of Shine Group, said: “Wil and Justin are true like-minded creative entrepreneurs and we welcome them and their team to Shine Group. They have built ChannelFlip into its leadership position through creative and commercial excellence, producing compelling and innovative online productions whilst persuading advertisers of the deeper relationships they can play within these. Following our entry into social gaming with Bossa Studios, this acquisition further underlines Shine Group’s relentless commitment to delivering excellence across all platforms and our determination to develop powerful direct to consumer models and connections to audiences, wherever they may be.”

Shine Group was acquired by News Corporation in April 2010 for a reported £415M.

USA, New York, NY & UK, London

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