AdMedia Partners, an independent merger and acquisition firm, announced today the findings of its 14th annual survey of senior executives at leading advertising, marketing services, and Internet marketing firms regarding the prospects for industry mergers and acquisitions. Conducted in December 2007, the survey found a number of emerging macro-economic catalysts as well as changes in the marketing services landscape that will impact business operations.
"Despite concerns of a recession or economic slowdown in the U.S., respondents were surprisingly optimistic about the environment for M&A deals and M&A valuations in 2008, said AdMedia Partners Managing Partner Abe Jones. "In fact, 67 percent of the executives surveyed expect to either approach or be approached about an M&A deal this year, and 39 percent expect to complete one or more merger and acquisition as a buyer or a seller, he added.
"Valuations remain robust, said AdMedia Partners Managing Partner Seth Alpert. "Despite concerns regarding the economy, respondents expect valuations for advertising and marketing services firms across the board to remain at last year's strong levels: 8x EBIT for digital marketing agencies, 6x to 6.5x EBIT for marketing services firms, and 5x EBIT for advertising agencies, he added.
Webinar to be held today, January 28, at 2 p.m. EST (11 a.m. PST)
AdMedia Partners Abe Jones and Seth Alpert will review results of and answer questions about their two newly released surveys: "2008 Prospects for Media Mergers and Acquisitions and "2008 Merger and Acquisition Prospects for Marketing Services and Internet Marketing Firms. To register, go to: https://www1.gotomeeting.com/register/990146883
The results of this year's survey identified some other key trends in 2008, including:
- Asia Rising - Highlighting the increasing impact of globalization, a near equal amount of respondents believe that the U.S./Canada and Asia hold the most growth potential for industry M&A. This represents a significant change from last year's results, when the U.S. was considered to have been by far the greatest growth opportunity.
- Disruptive Technologies - Online, wireless/mobile and social networking were most frequently cited by respondents as the most disruptive trends and technologies to the current advertising and marketing services industries.
- Offline Services Not Forgotten - Despite the high growth potential of online channels, strong demand persists for traditional advertising and marketing services, with more than three-quarters of respondents considering entering or expanding in offline sectors.
- Clients Driving Expansion of Services - The need to keep pace with the expanding range of marketing services and client demand for online capabilities were among the factors that drove 86 percent of respondents to enter new sectors during 2007.
- Anticipated Strong Spending Despite the Weakening U.S. Economy - While respondents are concerned about a potential slowing of the U.S. economy, they are optimistic about their own companies and feel that major events in 2008, such as the U.S. Presidential elections and the Olympics, will drive advertising spending and the demand for marketing services. In addition, the weakened U.S. dollar is attracting a new group of foreign buyers, opening up exciting new opportunities for sellers.
To access a free copy of the report on the M&A prospects for advertising, marketing services and Internet marketing firms in 2008, please visit the AdMedia Partners website at http://www.admediapartners.com.
About AdMedia Partners
Founded in 1990, AdMedia Partners provides M&A advisory services for digital and traditional media, marketing and information businesses. The firm has completed more than 150 M&A deals worth over $5 billion since 1999.
Select recent Marketing Services, Interactive and Internet Marketing transactions completed by AdMedia Partners include:
- Representing Refinery, an interactive marketing solutions agency, in its acquisition by WPP's G2 Worldwide.
- Representing Ignite Health, a leading interactive healthcare marketing agency, in its acquisition by inVentiv Health.
- Representing Spannerworks, a leading U.K. search engine marketing agency, in its acquisition by iCrossing.
- Representing New Media Strategies, a leading online word-of-mouth marketing agency, in its acquisition by Meredith Corporation.
- Representing Genex, an interactive marketing services firm that specializes in online customer relationship marketing, in its acquisition by Meredith Corporation.
- Representing Medical Broadcasting Company, one of the largest independent interactive healthcare agencies, in its acquisition by Digitas Inc.
- Representing Impulse Marketing Group, an online lead generation affiliate marketing company serving the financial services industry, in its acquisition by an undisclosed buyer.
- Representing Glover Park Group, a corporate communications and public affairs firm, in its sale to the private equity firm Svoboda, Collins.
- Representing Chandler Chicco, a full-service, global healthcare public relations firm, in its acquisition by inVentiv Health, Inc.
- Representing CFM Direct, a leading direct marketing agency, in its acquisition by Merkle, a leading database marketing agency.
