Media M&A activity mixed in 2009

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New York—The number of M&A deals in the information, publishing, Internet and training sectors declined 13% last year, according to a report issued Monday by Whitestone Communications.

Despite fewer deals, the aggregate transaction value rose last year, increasing to $25.4 billion from $23.6 million in 2008. Helping to boost last year’s total value was the $5.2 billion acquisition of IMS Health by TPG Capital and the Canada Pension Plan.

In the fourth quarter, the increase in aggregate deal value accelerated, increasing to $12.1 billion from $3.2 billion in the year-earlier period. The number of deals fell 17% in the fourth quarter from the same period in 2008.

“The fourth-quarter falloff in deal pace showed just how weak the acquisitions market was,” Whitestone Communications President Baran Rosen said in a statement. “While everyone was talking about the recovering stock market, the acquisition market was still slumping.

“The reasons we saw for a depressed market were several-fold. First, business owners were having weak results in 2009 and wanted to wait for improvement before considering a sale. Second, buyers were thinking they could get businesses at bargain prices and so were keeping offers below what the limited number of sellers were willing to take. Third, banks were still not lending or not lending on terms that buyers found sufficient to help them move forward to make purchases.”

The number of trade magazine/trade show deals declined from 72 in 2008 to 55 in 2009, a drop-off of 23.6%.

Whitestone also noted that United Business Media made 16 acquisitions in 2008 but only five in 2009.

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