Read Arma’s view on how the technological revolution is posing challenges for media’s biggest players of the 20th century, and how inward investment is now being funnelled towards digital publishers that can provide quantitative insights, on Forbes here.
Over the past 15 years, the print giants that dominated the 20th century media landscape have become increasingly threatened by the technological revolution. On the other hand, other types of publishers have actively thrived in this period of radical change, making them ideal targets for strategic and financial acquirers.
One category profiting from inward investment is specialist data providers that offer their corporate clients real-time, comprehensive, sector-specific quantitative analytics and editorial insight. Such companies with scalable, subscription-based business models are highly attractive to acquirers seeking recurring revenues and room for further profit growth.
A clear example of such an acquisition is that of Incisive Insight, a division of the publishing group Incisive Media, by Infopro Digital, a French information services group, in 2017, on which Arma acted as exclusive sell-side financial advisor.
One category profiting from inward investment is specialist data providers that offer their corporate clients real-time, comprehensive, sector-specific quantitative analytics and editorial insight.
Two other trends emerging from these activities include American interest in European assets (such as General Atlantic’s acquisition of a controlling stake in UK energy and commodities data provider Argus Media) and the popularity of financial data providers (for example, Morningstar’s acquisition of an 80% stake in PitchBook Data, a specialist in private capital research).
In the progressively splintered world of media in the digital age, B2B data companies are actively thriving.
Deals for data companies are increasing in terms of both volume and value. It is their simple business model that is responsible for their attractiveness to investors, as it allows them to take on higher levels of debt with greater security. What’s more, revenues and profitability increase in tandem.
Nevertheless, there is a stark contrast between how B2B (business-to-business) and B2C (business-to-consumer) companies are faring. For B2C media businesses, which target a broader readership of individual consumers, revenues are less secure as their traditional income sources (subscriptions and advertising) are in decline.
In the progressively splintered world of media in the digital age, B2B data companies are actively thriving. Investors are interested in profiting from media companies’ sustained growth potential, fueling the M&A activity that these companies rigorously analyse everyday.