Combined trade magazine and trade show sales doubled in the second quarter of this year compared to the same period in 2005, says M&A advisory firm, Whitestone Communications in its "Who's Buying Whom" report. There were 24 trade magazine and trade show deals in the second quarter, compared to 12 in the second quarter of last year, the report says. "If it's not nailed down, it's for sale," said Whitestone managing director Ed Fitzelle, in a statement.
Several publishers are on the market going into the third quarter including Ziff Davis, Highline, Pfingsten and Penton Media, which just closed its first-round bids and is said to be garnering an extraordinary amount of interest from potential buyers. Though the M&A market has been robust, several trade publishers that went on the market earlier this year, did not sell — including Endurance Business Media, CurtCo, and Cygnus Business Media, which like Penton is owned by the Boston-based private-equity firm ABRY Partners.
The number of trade magazine-only deals more than doubled in the second quarter to 13, up from six a year ago, while trade shows almost doubled at 11, compared to six a year ago. The biggest buyer of trade magazines was the newly formed 1105 Communications, which bought 101 Communications for $75 million and Stevens Publishing for an undisclosed price (the deal was estimated to be about $30 million).
Fitzelle described this year as the busiest time for trade magazine buying and selling in a number of years. "Driving this activity are several factors: one, a good economy; two, a resulting improvement in magazine financials; and three, ready capital available from both strategic and financial buyers," he said.
Deals may be up, but the dollar value of the transactions is down. Last year, $1.2 billion in transactions was racked up in the second quarter. This year just $261 million was recorded. Last year's numbers were driven by the sale of Hanley Wood to JP Morgan Partners for $650 million and the $200 million sale of Canon Communications to Apprise Media by Veronis Suhler Stevenson's private equity fund.
The nearly $11 billion VNU sale in June was not included in Whitestone's analysis because VNU draws much of its revenue from marketing and media measurement information, as well as trade publications, the report said.
On the consumer side, deals were fairly flat—10 this year, compared to eight in the second quarter of last year, according to the Whitestone report. The dollar amount was down from $397 million last year to $32 million this year.
From Folio Magazine, August 2006
© August 31, 2006 www.foliomag.com
