Blog Post

M&A Volume Still Low in Q3; Mobile and Education Picking Up Slack

Earlier we talked about future deals coming in our sector. Now a look back: M&A pace in the media/info sector picked up during third quarter of this year, compared to the first two quarters, according to data compiled by boutique bank The Jordan, Edmiston Group. A total of 168 announced transactions valued at $11.1 billion in Q3, compared to only $5.3 billion in deal value for the first half of 2009, with a high concentration of small distressed sales. There were over a dozen $100+ million and $1+ billion transactions, which drove average deal size from $18 million in the first half of the year to $66 million in Q3.

Education related deals increased by 15 percent in number and 41 percent in value to $3.2 billion, as this sector “benefits from innovation, government spending and some shelter from the economic cycle,” the report says. Meanwhile, mobile sector saw 25 transactions worth just under $400 million, up 56 percent in number and 76 percent in value from 2008. Not surprisingly, strategic buyers accounted for roughly 80 percent of total deal value through Q3. Also not surprising, B2B media sector still sucks. Breakdown of deals by sector, after the jump.

Also, another boutique Petsky Prunier also came out with its Q3 deals report. From its report: Ad networks garnered strong interest from growth equity investors, with five businesses receiving a total of approximately $69 million, bringing year-to-date totals to 14 investments for approximately $163 million. Digital video’s still hot, with five companies receiving approximately $27 million in funding. To date, there have been 12 transactions with digital video businesses for approximately $162 million. Also, year-to-date, Draper Fisher Jurveston has been the most active financial investor in Marketing, Information and Digital Media sector, announcing three investments this quarter and nine investments in total so far this year. Additionally, Highland Capital Partners announced three investments, and Globespan Capital Partners and Matrix Partners each announced two transactions in 3Q09.