It’s a Buyer’s Market for Exhibitions, According to AdMedia Survey of M&A Activity

HIL ANDERSON, SENIOR EDITOR
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New York, NY – A survey of media executives worldwide found that while nearly all expected the pace of mergers and acquisitions within the industry to slow in 2009, more than half said they expected to strike a deal or two themselves.

AdMedia Partners, Inc., a New York firm that advises clients on mergers and acquisitions, surveyed 1,500 senior executives in December.  The poll found 63% expected to make an acquisition in 2009.  Optimism was fueled primarily by expectations that some attractive properties would be put up for sale by companies in need of quick cash.

Asking prices, the survey found, were considered to already be fair if not an “undervalued” bargain.  While 61% of respondents felt that the time was right to make an acquisition, 73% said sellers should hold back for a few months until the economy got back on track and the market improved.

Here are some other key findings:

•  A definitive 55% of the respondents thought online media properties were overvalued.

•  Sale prices for exhibitions were expected to slip to around five times EBITDA in 2009 after reaching as high as 7 to 10 times EBITDA in 2005.

•  Virtually all respondents agreed a global recession was underway and 80% predicted the economy would be weaker in 2009 than it was in 2008.

On a more positive note, 35% of the respondents expected the downturn to last four quarters compared to 12% who feared the tough times would last more than a year.  Most of the executives expected GDP to resume growing in 2009 and that their main concern was getting the credit markets back on track to provide the funding needed to consummate acquisitions.  The survey found 51% of executives estimating the cash flow would be getting back to normal in 12 months compared to 20% who thought it would take six months.

Reach Michael Parker, managing director, AdMedia Partners, Inc., at (212) 759-1870 or mparker@admediapartners.com