AdMedia Survey Finds Market Will Be Active, but Desirable Properties Are Few

By Published on .

NEW YORK ( -- Media mergers and acquisitions this year are likely to outpace 2005 levels, according to the latest annual survey from AdMedia Partners, the investment banking and advisory firm that focuses on the publishing, advertising and interactive businesses.
'Vibe' and 'Spin' are currently looking for a new owner.

About two-thirds of media and financial executives surveyed predicted that mergers and acquisitions activity would increase in 2006, AdMedia said. (That would, of course, be great news for AdMedia, which makes much of its money facilitating such deals.) Only 5% foresaw a slowdown.

Cross-media deals
Respondents also predicted that much of the activity they foresee is likely to cross sectors. “Demand for digital content was clear in both the survey data and open-ended comments, and we expect to see more acquisitions of cross-media partners by traditional media companies,” said Mark Edmiston, managing director. “Down the road, tightening of lending criteria and potential increases in capital gains tax rates could make M&A less attractive, but in 2006 conditions remain favorable.”

Fewer than half the respondents, however, said they believe there are a healthy number of acquisition targets.

Last year brought the wholesale departure of Gruner & Jahr from U.S. shores, which produced Meredith Corp.’s acquisition of Parents, Child, Fitness and Family Circle for $350 million last May and Joe Mansueto’s purchase of Inc. and Fast Company for $35 million in June.

In March, The New York Times Co. completed its $410 million acquisition of and the $16.5 million purchase of a 49% stake in Metro Boston, the free commuter daily. In August, Time Inc. bought the Mexican publisher Grupo Editorial Expansion for an estimated $60 million.

Properties on the block
Properties now on the block include Knight Ridder, which was forced to entertain offers by activist shareholders, and Vibe and Spin magazines. Rumors persist that Time Inc. may trim its stable of magazines, perhaps by auctioning off its Time4 Media unit. And if billionaire financier Carl Icahn has his way at Time Warner’s next company meeting, that company will have to explore splitting itself into pieces.

AdMedia sent surveys to about 1,500 people and recieved about 300 replies.

Most Popular
In this article: