Despite the current economic climate, Reed Exhibitions has its eye on trade shows in the U.S.
Mike Rusbridge, chairman-CEO of Reed Elsevier's $1.4 billion trade show arm, pointed out at last month's DeSilva & Phillips Media Dealmakers Summit in New York that Reed Exhibitions, even at its size, controls just 5% of the worldwide exhibitions market. “It's a highly fragmented market,” he said.
Rusbridge said Reed Exhibitions has 20% of its business in the U.S., a percentage he described as “underweight.” “We're already looking for more deals in the U.S. to bolster that,” he said. “We know who we want, and we know who they are.”
Through acquisitions and organic growth focused in the U.S., Brazil, Russia, India, China and the Middle East, Rusbridge hopes to double Reed Exhibition's trade show market share.
Some observers speculated that Reed Elsevier, given its failure to sell Reed Business Information last year, might have some difficulty making new acquisitions. But the company's announcement in February that it had secured a new $2 billion credit facility may put it in a better position to make deals.
“Now is a great time to be looking for acquisitions,” said Richard Mead, managing director of media investment bank Jordan, Edmiston Group. “There will be opportunities if you have the capital.”
In conjunction with Tradeshow Week, Mead's firm recently released the “2009 Exhibition and Conference Industry Outlook,” based on an online survey of 126 event industry executives conducted last December.
Sixty-three percent of event industry CEOs surveyed described the North American mergers and acquisitions market for events as “good.” However, 69% said they were “not very likely” to acquire an event this year. Similarly, 82% said they were “not very likely” to sell an event this year.
If Rusbridge and Reed Exhibitions are swimming against the current in pursuing acquisitions, they also are out of the mainstream when it comes to believing that a media company should have online, print and in-person components. Reed Elsevier seems intent on selling its print b-to-b arm, despite temporarily pulling Reed Business Information off the market. Marketing executives, Rusbridge said, “make specific buying decisions around exhibitions, not around other forms of media.”
Reed Phillips, co-managing partner of DeSilva & Phillips said, “Reed Exhibitions has shown over a period of years a good track record, and they've done that without print synergy.”
Rusbridge does see some drawbacks in holding events that only reach the target market for a handful of days every year. He said Reed Exhibitions is exploring the creation of vertical Web portals for the shows and industries it serves. “It will enable us to interact with that community throughout the year,” he said. M