M&A Market Heats Up in First Half of 2010

(Press Release) New York, NY June 30, 2010 — The M&A market for media, information, marketing services, education and related technologies rebounded strongly in the first half of 2010, led by digital and technology‐driven businesses. Announced were 445 transactions with a total value of $21 billion, reflecting a 52% increase in deal volume and a 291% surge in deal value over 1H 2009 levels, according to The Jordan, Edmiston Group, Inc. (JEGI), the leading independent investment banking firm covering these market sectors. JEGI's activity reflected the increasing deal pace, as the firm completed 10 M&A transactions in the first half of the year, including Hearst Corporation's acquisition of global interactive marketing services and technology company iCrossing. The sharp rise in market deal value was driven by several multi‐billion dollar transactions announced in Q2 2010, including Madison Dearborn Partners' acquisition of credit and information management company TransUnion for an estimated $2.5 billion and the acquisition by Silver Lake Partners and Warburg Pincus of financial information provider Interactive Data Corporation for $3.2 billion. Overall, six market sectors saw strong growth in M&A in the first half: B2B Online Media (number of deals up nearly 4x), B2C Online Media (+64%), Business‐to‐Business Media (up nearly 4x), Database & Information Services (+90%), Marketing & Interactive Services (+96%), and Mobile Media & Technology (+188%). Interactive media, marketing services and digital and mobile technology continue to propel deal flow, as the B2B and B2C Online Media & Technology, Marketing & Interactive Services, and Mobile Media & Technology sectors accounted for 74% of total deal activity in the first half of 2010. Large interactive, marketing services and technology companies continued to be active acquirers, including Acxiom, Akamai, Alliance Data Systems, Apple, Facebook, Google, GSI Commerce, IAC, IBM, InfoSpace, Interpublic, Juniper Networks, Oracle, Publicis Groupe, Salesforce.com, Twitter, WPP, Yahoo, and Zynga. The largest deals announced by this group in the second quarter included IBM's acquisition of Coremetrics, the web analytics and digital marketing optimization company, for an estimated $150 million; Salesforce.com's acquisition of Jigsaw Data Corp., an online business contact database, for $142 million; Alliance Data System's acquisition of Equifax's Direct Marketing Services division for $117 million; and Yahoo's acquisition of online content publisher Associated Content for a reported $90 million. However, average deal sizes for the interactive markets remained relatively small, averaging $23 million vs. an average deal size of $47 million for the overall media marketplace. With interactive marketing spending in the US estimated to reach nearly $30 billion in 2010, according to Forrester Research, media companies are seeking to incorporate more interactive marketing services into their product offerings, to more deeply service brands and advertisers. CBS, News Corp., Nielsen, Time Warner, and United Business Media all made acquisitions in the interactive, marketing services and technology markets in the second quarter of 2010. Hearst's acquisition of iCrossing reflects broader efforts by diversified media companies to augment display advertising sales with a complementary presence in interactive marketing services, and JEGI anticipates similar transactions going forward, as other media groups tap into higher growth services. Strategic Buyers Continue to Lead M&A Charge, but PE Picking Up Steam Of the 211 transactions announced in the second quarter of 2010, 45 were led by private equity firms or PE‐backed companies, a modest pace compared to earlier periods, but a sharp increase from 2009. Private equity firms, with approximately $425 billion of uncommitted capital, according to Cambridge Associates, are becoming more active once again; they accounted for the two largest transactions of the quarter - the acquisitions of TransUnion and Interactive Data Corporation. In interactive, marketing services and technology, numerous PE firms were active buyers, including Austin Ventures, AXA Private Equity, Blackstone Group, Great Hill Partners, H.I.G. Ventures, Providence Equity Partners, Riverside Company, Veronis Suhler Stevenson, Wicks, and ZelnickMedia. The largest PE deal in these markets during the quarter was AXA Private Equity's acquisition of online travel agent Go Voyages from Groupe Arnault for $493 million. The full first-half 2010 M&A report can be read at http://www.jegi.com/

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M&A Market Heats Up in First Half of 2010

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