Time is right for more sales according to industry poll

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For marketing companies considering a sale, the best time may be today.

"The most favorable market conditions exist now and may never be seen again," was one respondent's comment to an annual survey conducted by AdMedia Partners, a mergers and acquisitions company that specializes in media, advertising and Internet businesses.

The sixth annual survey, the results of which were released recently, gives every indication that deals among agencies will continue to be struck.

Eighty-six percent of the more than 500 senior executives at advertising and marketing services companies surveyed said they are considering expanding in at least one of the core advertising and marketing services sectors in 2000. That continues a trend started the year before: 72% of respondents said the mix of sectors in which their companies operate changed in 1999.

Of the executives queried, 35% are with ad agencies, 51% are employed by marketing services companies and 14% hold jobs with holding companies; 61% work for privately held companies.

The area where the most respondents (64%) plan expansion is interactive multimedia advertising. Fifty-four percent would like to expand into marketing consulting services. Database management was cited by 43% of respondents, while 45% said they were looking to expand direct marketing services. Sales promotion interested 33% of expansion-minded respondents, while public relation operations interested 31%. Twenty-nine percent plan to expand media buying services.

In 1999, the majority of respondents were actively looking for acquisition opportunities and entertaining proposals from suitors. But there was definitely more talking than dealing. Seventy-nine percent admitted they were on the hunt for a suitable acquisition in 1999, and 53% engaged in negotiations to acquire but just 35% completed a buy. Fifty-eight percent admit to being approached by a potential buyer, while 36% engaged in negotiations and just 12% were acquired.

Forecasting into 2000, 81% anticipate looking for a suitable acquisition, 66% plan to approach a prospective acquisition and the same number expect to enter into negotiations. Forty-eight percent expect to complete an acquisition, but just 9% expect to be acquired. Continuing another industry trend, 10% expect to make a public offering.

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