Media Deals: Volume Grows, But Revs Hold Steady

Total media and marketing transaction volume grew by double-digit percentage in 2014 -- but the total number of transactions and the average revenue and cash flow selling multiples remained generally the same as the year before.

Investment banker Berkery Noyes says transaction volume rose 22% to $91 billion in 2014 over the year before; with the number of transactions at 1,696 in 2014 versus 1,697 in 2013.

The median revenue selling multiple of those deals stayed the same year-to-year at two times revenues. Cash flow -- earnings before interest, taxes, depreciation, and amortization -- was a bit higher in 2014: 10.9 times versus 9.7 times.

The marketing category continued to be the most active a year ago -- growing to near $600 transactional dollar volume. Internet media deals, the second biggest category, dipped a bit to around the $400 million level; and entertainment content acquisitions, totaling $200 million.

The biggest deals were Leonard Green & Partners purchase of Advantage Sales and Marketing for $4.2 billion; Media agency holding company Publicis Groupe’s $3.4 billion deal for marketing agency Sapient; and real estate Web site Zillow’s $2.9 billion deal for competitor Trulia Inc.

When it comes to traditional media, TV station group Media General bought another big TV station operator LIN Media for $2.35 billion. In the gaming field, there was Microsoft’s $2.5 billion acquisition of Mojang, the developer studio that created the video game Minecraft. In the Internet space, Amazon bought Twitch Interactive for $970 million.

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