Will 2017 Be A Battle For Media M&A?
Media M&A has picked up significantly over the last few years in line with the structural changes to the industry. With the increasing development of technology that is now readily available to consumers has come a growing appetite to digest media through a number of channels.
In today’s world the power of print is dwindling, and virtually all newspapers and magazines now engage their readership through apps and, in some cases, subscription websites. On demand television and live streaming have seemingly replaced the traditional television set, and advances in technology development will bring about even more channels for consumers to view and read media in the near future.
With that in mind, a number of industry experts are calling for traditional media companies to consider their M&A strategy in order to stay ahead and not get left behind as the media industry continues its momentum of progress. Arguably, these traditional organisations that have not yet expanded into other channels may be at risk of being bought in a wave of consolidation if they do not think proactively and acquire up-and-coming, innovative media start-ups.
As the future of these businesses ultimately hinges on their appetite, or attractiveness, for M&A, forecasters predict that 2017 is set to see a media M&A frenzy. Rumoured activity include Apple’s potential deals with either Netflix or Time Warner, and the Walt Disney Company’s talks with Vice Media, of which it already owns an 18 per cent stake, while Paramount Pictures remains hungry for a strategic investor that will build its digital capabilities.
While next year is tipped to be one of the most successful years for media M&A yet, quarters one, two and three of 2016 have already producing some significant deals for the sector, including:
- IBM’s purchase of UStream, the live streaming video service, for $130m. The technology giant’s acquisition is one of the year’s largest transactions, indicating the growing dominance of live streaming technology.
- Comcast’s $3.8bn acquisition of DreamWorks Animation in Q2. A comparatively small acquisition for the media conglomerate, but an important addition to strengthening Comcast in the animation market.
- Warner Bros. acquisition of Korean Streaming/Subscription Video on Demand (SVOD) service DramaFever for an undisclosed figure. An influential deal in the Asian market which will pave the way for Warner Bros. to launch new over-the-top services.
- Dalian Wanda Group’s purchase of Legendary Entertainment for $3.5bn in Q1, and the following announcement of the Group’s $1.1bn bid for Carmike Cinemas. The largest China-Hollywood deal to date, the acquisition of Legendary Entertainment significantly expands Wanda’s presence in global entertainment. The Carmike acquisition, through Wanda-owned AMC, will create the world’s largest cinema chain, further extending Chinese influence in the film industry.
With experience in a number of key sectors and representation throughout the Americas, Europe, Africa and Asia, Benchmark International can connect you with the right opportunity. To find out more, visit http://www.benchmarkcorporate.com.