Ratings Analyst Nielsen Headed Toward Acquisition By Private Equity Group
Decades old TV ratings giant Nielsen is poised for purchase by private equity consortium Evergreen Coast Capital Corporation and Brookfield Business Partners for $16 billion.
The buyer represents a consortium of venture capital firms led by Elliott Management and Brookfield Asset Management, which is to put up $5.7 billion in equity with the remaining $10.3 billion to come from large banks and private lenders.
The Nielsen Board of Directors voted unanimously for the acquisition proposal, which amounts to a 60% premium over Nielsen’s unaffected stock price.
“After a thorough assessment, the Board determined that this transaction represents an attractive outcome for our shareholders by providing a cash takeout at a substantial premium, while supporting Nielsen’s commitment to our clients, employees and stakeholders. The Consortium sees the full potential of Nielsen’s leadership position in the media industry and the unique value we deliver for our clients worldwide,” James A. Attwood, chairperson of Nielsen’s board of directors, said in a statement.
The transaction is still subject to approval by Nielsen’s shareholders, and Nielsen’s bankers continue to have 45 days to seek a higher bid under a “go-shop” clause.
Nielsen’s core business revolves around measuring advertising reach on cable and broadcast platforms, but this has been threaten with the rise of digital services like Netflix, resulting in Nielsen losing its grip as a provider of relative data to advertising buyers as cable and broadcast networks have chanllegned its measurement data.
The buyers, however, said they are encouraged by Nielsen’s new measurement product, Nielsen ONE, which better combines results of network television and streaming media usage.
“After months of deep market analysis, industry diligence and management reviews, we are firmly convinced that Nielsen will continue to be the gold standard for audience measurement as it executes on the Nielsen ONE roadmap,” managing partner Jesse Cohn and senior portfolio Manager Marc Steinberg, said in a joint statement on behalf of Evergreen and Elliott. “Having first invested in Nielsen nearly four years ago, we have a unique appreciation for the Company’s ongoing relevance to the global, digital-first media ecosystem. Today’s outcome represents a significant win for Nielsen’s shareholders and for the business itself, as our multibillion-dollar investment will help Nielsen reinforce its transformation at this critical inflection point. We are pleased to partner with David and the existing management team to lead Nielsen after the transaction is completed.”
Nielsen, based in Chicago, provides clients with insights into global consumer media viewer/listening behavior and marketing information. The company’s measurement data is used to determine what consumers watch and buy. The well-known Nielsen ratings metrics have been one of the most-used indicators of audience size for television, radio, and newspapers in diverse markets.
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By Greg Tarr
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