Media and marketing M&A posts strong 2011; b-to-b sector activity mixed

By Sean Callahan

New York—Merger and acquisition deal value in the media, information, marketing services and technology sectors increased 9% to $47.0 billion in 2011 over 2010, according to data released Sunday by investment bank Jordan, Edmiston Group. The number of deals in these sectors rose 2% to 896 for the year, Jordan, Edmiston said.

Marketing and interactive services was the most active category, with 291 deals (up 17% over 2010) and $15.1 billion in deal value (up 33%). M&A activity for 2011 was driven by deals in the digital sector.

“Overall, the interactive markets, including b-to-b and b-to-c online media and technology, and mobile media and technology, as well as marketing and interactive services, accounted for 71% of M&A deal activity for the year and 65% of the value,” Jordan, Edmiston said in a press release.

The b-to-b online media and technology category posted a gain of 3% in the number of deals, to 63, and a 132% gain in deal value, to $6.0 billion. Among the largest deals was Oracle Corp.'s $1.1 billion acquisition of Endeca Technologies, which markets software that helps marketers improve e-commerce efficiency.

Traditional b-to-b media suffered a dismal M&A year in 2011. The number of deals decreased 62%, to 14, and the aggregate deal value plummeted 91%, to $50 million. However, the exhibitions and conferences category showed its resiliency as the number of deals increased 39%, to 32, and aggregate deal value increased 249%, to $451 million. The bellwether deal in this sector was Providence Equity Partners' $180 million acquisition of George Little Management.

Tracking deals in the marketing, media, technology and service industries, investment bank Petsky Prunier reported the number of deals increased 187%, to 3,026, and the aggregate deal value grew 152%, to $141.6 billion. Digital media/commerce was the most active segment, with transactions reaching 1,159 and deal value totaling $44.0 billion.

According to Petsky Prunier, the second most active M&A segment in 2011 was marketing technology, which saw 338 transactions valued at $21.9 billion. Among the largest deals in this segment was Oracle's $1.5 billion acquisition of RightNow Technologies.

While 2011 overall was a boom year, Petsky Prunier's deal database showed a decline in the fourth quarter, with the number of deals falling to 764, a drop of 6% compared with the third quarter of 2011. In the same time frame, aggregate deal value fell 42%, to $27.2 billion.