Pace of deals picks up

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First-quarter reports from media investment advisory firms Jordan, Edmiston Group and Whitestone Communications show that media acquisition activity is back on the rise after a slowdown in the second half of 2004.

The upward trend on the b-to-b side has been greatly bolstered by a recent flurry of deals, including the completed sale of Dowden Health Media to Lebhar-Friedman for a reported $40 million, and Advanstar Communications' agreement to sell its Information Technology & Communications, Travel & Hospitality, Beauty, Home Entertainment, Abilities and Portfolio groups to the newly formed Questex Media Group for $185 million.

"There has been more activity in such a short period of time than I have witnessed in several years," said Baran Rosen, president of Whitestone Communications. "And there is at least one more big property on the block as Veronis Suhler Stevenson looks to sell Hanley Wood," he added

Jordan, Edmiston's first-quarter report tracked 140 completed media deals across 11 sectors worth $9.7 billion. That was up from 109 deals worth $4.2 billion during the same period last year. Jordan, Edmiston tracked 12 deals in the b-to-b magazine space, worth about $349 million, compared with 11 deals, worth $676 million, in the year-earlier period.

The strongest activity took place in consumer magazines (number of deals up 120%, total deal value up more than 1,000%); marketing and interactive services (number of deals up 75%, total value up 82.9%); exhibitions and conferences (number of deals up 28.6%, total value up 16.7%); newspaper publishing (number of deals up 15%, total value up 244%); and directory and reference publishing (number of deals flat but total value up more than 950%), according to the Jordan, Edmiston report.

"While b-to-b looks to have taken a step backward from last year, if you back out the major acquisition of Centaur Communications for nearly $300 million [in the first quarter of 2004] then the b-to-b sector has fared well," said Tolman Geffs, Jordan, Edmiston managing director.

The major first-quarter b-to-b deals included:

  • World Media's acquisition of the AD:TECH conferences and trade shows from JD Events.
  • Edgell Communications' acquisition of Apparel Magazine and related event and online properties from VNU Business Media.
  • Schofield Media's acquisition of Restaurant Business, FoodService Director, Beverage World, Retail Merchandiser and the ID Access Web site from VNU Business Media.
  • Lebhar-Friedman's acquisition of Dowden Health Media.

Geffs said both strategic and financial buyers will be closely looking at online media properties this year and beyond. "Online media has finally received broad-based buy-in because current online advertising models have the potential to generate substantial revenue," he added.

According to Jordan, Edmiston's first-quarter report, online media deals-both b-to-b and consumer-increased from 18 to 22, and from $1.4 billion to $2.6 billion. 

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