• by Gavin O'Malley  @mp_gavin, April 1, 2010

The M&A market across the media, information, marketing services and technology sectors continued to recover during the first quarter of the year, according to a new analysis from Jordan, Edmiston Group.

During the first quarter, the number of deals announced -- 234 -- increased 70%, while overall transaction value -- $8.2 billion -- rose to over five times that seen during the first quarter of 2009.

Compared to the fourth quarter of 2009, the first quarter of 2010 saw 58% more M&A deals, while transaction value fell 43%.

JEGI attributed this decline to the fact that there were no sizable transactions to match the two large deals announced at the end of 2009 -- the sale of Springer Science to EQT Partners for $3.4 billion, and the sale of IMS Health to TPG Capital and CPP Investment Board for $5.2 billion.

The strong rise in year-over-year M&A activity was driven by six sectors: business-to-business online media, which saw deals increase 12-fold; business-to-consumer online media, which was up 79%; B2B media, up nearly fivefold; database and information services, up over 200%; marketing and interactive services, up 41%; and mobile media and technology, up more than threefold.

Overall, B2B and B2C online media, marketing and interactive services --including mobile -- accounted for 74% of all deal activity during the first quarter of the year.

"Many of the large interactive media and marketing companies were active in the quarter," said a JEGI spokesman. Indeed, Aegis, AOL, Apple, comScore, Dentsu, Facebook, Google, Monster, and News Corp. were all busy during the period.

The three largest interactive deals were Apple's acquisition of mobile ad network Quattro Wireless for $275 million; Monster's acquisition of online recruiter HotJobs from Yahoo for $225 million; and Japanese holding company Dentsu's acquisition of digital agency Innovation Interactive from ABS Capital Partners for $220 million.

In all, the first quarter witnessed two transactions exceeding $1 billion, and ten exceeding $100 million, by JEGI's estimates.

The largest deals in the quarter included MSCI's acquisition of risk management and corporate governance services provider RiskMetrics Group for $1.6 billion, and the acquisition by a consortium of private equity firms of e-learning provider Skillsoft for $1.1 billion. Another big one was CCMP's acquisition of database and list manager InfoGroup for $635 million.

Out of the 234 transactions announced in the first quarter, only 32 -- or 14% -- were led by private equity firms or PE-backed companies.

Two-thirds of these PE-led deals were within "traditional" media markets, including B2B and consumer magazines, tradeshows, database and information services, as well as education.

With 36 transactions at a total value of $407 million, the B2B online media and technology sector was one of the most active during the first quarter.

Small transactions dominated the sector, with average deal size of only $11 million, compared with an average deal size of $150 million for the database and information services sector.

Notable transactions in the quarter included Shanda Games' acquisition of Mochi Media, an online gaming tools and services provider, for $80 million, and AOL's acquisition of StudioNow, a platform to create online video and animation, for $36.5 million.

The B2C online media and technology sector continued to be the most active sector covered by JEGI, with 61 transactions in the first quarter of the year.

Once again, small transactions were prevalent in this sector, with average deal size of $12 million for the quarter. The largest B2C online media transaction was Monster's acquisition of HotJobs from Yahoo for $225 million, followed by Google's purchase of Aardvark, a social search engine, for $50 million, and Key Brand Entertainment's acquisition of Broadway.com for $45 million.

Meanwhile, the number of M&A transactions and transaction value for the B2B media sector increased sharply year-over-year, as Reed Elsevier continued to divest US print and related online media assets, as it unwinds Reed Business Information US.

Several other large global corporations divested B2B media assets in the quarter, including The Economist Group, which sold CFO, and Nielsen, which sold its Retail and Travel Groups.

Marketing and interactive services was the second most active sector for M&A in the first quarter, with 48 transactions at a total value of $1.2 billion. The sector showed strong gains of 41% and over 165% in number of deals and transaction value, respectively, versus the first quarter of 2009.