Worries about a softer economy have started to slow the pace of mergers and acquisitions, according to an overview of the media and information industries released Oct. 3 by the Jordan Edmiston Group.
The report said third-quarter mergers and acquisitions action was “clouded by credit market disruption and concerns for a potential advertising and broader economic slowdown.”
But deals for the first nine months of 2007 have outpaced those for full-year 2006, a record year for mergers and acquisitions in the media marketplace. In fact, the period was dominated by deals in the online media and marketing and interactive services space.
Online media acquisitions for the period included R.H. Donnelly’s acquisition of Business.com for $345 million and the Walt Disney Co.’s purchase of Club Penguin for $350 million.
Marketing services was dominated by Google’s pending $3 billion DoubleClick acquisition and Microsoft’s massive aQuantive buyout.
Smaller deals during the third quarter continued to fuel the sectors, including two major portals snapping up ad networks: Yahoo’s purchase of Blue Lithium and AOL’s acquisition of Tacoda.
Newspapers had a robust third quarter, thanks to News Corp.’s $5.6 billion deal to acquire Dow Jones. That move drove up deal value 37 percent for the first three quarters of 2007 compared with the year-ago period, according to Jordan Edmiston research.
The report noted that activity in the consumer magazine sector had slowed in the third quarter, although, through the first three quarters of 2007, deal value remains more than 80 percent above the same period last year.