A digital media M&A market frozen by existing economic conditions showed signs of thawing in the second half of 2009 as buyers returned from the sidelines with cleaner balance sheets and a recalibrated strategic focus. On the year, there were 755 capital raises, mergers, and acquisitions in digital media, representing a 7% increase over the 707 recorded in 2008. Although total transaction value dropped 10% from $16.9 billion in 2008 to $15.2 billion in 2009, the second half accounted for $11.1 billion of this figure, offering a promising outlook for 2010.
While the year began with a wait-and-see approach and a focus on housecleaning and return to core-competency, the second half was propelled by a wave of strategic acquisitions, follow-on venture capital investments in portfolio companies that were able to cut costs and weather the economic storm, as well as divestitures of underperforming or non-core assets. Major strategic acquisitions included Adobe’s $1.8 billion acquisition of Omniture and Amazon’s $928 million purchase of Zappos.
Even in weak economic conditions, mobile, e-commerce, ad technologies, and web analytics all enjoyed prosperous years in 2009. Mobile asserted itself as a popular digital platform, consumers grew increasingly comfortable with online shopping, and the optimization of advertising revenue through more effective targeting of engaged users emerged as a major trend.
For a comprehensive analysis of the digital media M&A environment in 2009, download the complete report from Peachtree Media Advisors at http://www.peachtreemediaadvisors.com/?p=research.
About Peachtree Media Advisors
Peachtree Media Advisors, Inc. is a New York-based investment bank providing M&A advisory services to growth and middle market digital media companies both in the U.S. and abroad. John Doyle, Managing Director & Founder, has been a media investment banker for more than 13 years; closed and structured more than 22 deals; and has a strong knowledgebase of financial and strategic buyers in these sectors. If you are interested in learning more about valuation, positioning, preparation or the merger and acquisition process, please visit http://www.peachtreemediaadvisors.com or contact John Doyle at 212-570-1009.
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