Everything is for sale, but what's left to buy?

Position::Everything Is For Sale

The reality in a Wall Street-dominated and indomitable world is that mid-size and large entertainment companies can only grow by acquisition. And, in the recent past, this is what has happened at a pace as voracious as Wall Street speculators' appetites. But now that mergers and acquisitions (M&A) have slowed down due to a dwindling number of companies on the market that are desirable, these same mid-size and large companies are forced to show some growth by cost savings. As the saying goes: everything is for sale, but what's left to buy? Indeed, Chase Carey, president of 21st Century Fox, recently stated that his company's "priorities [are] building businesses, over buying them."


According to the New York City-based media investment bank JEGI, "The media, information, marketing, healthcare and technology sectors saw a healthy 708 transactions in the first half of 2013, roughly even in both volume and value with the first half of 2012," including the highly publicized sale of the Boston Globe and the Washington Post.

If 708 seems like a lot of mergers that you somehow missed, don't worry--most of them were, as the statement suggests, in areas that are not of interest to MIPCOM delegates. But there have been a few eye-catching mega mergers lately that will have implications for those of us gathered in Cannes.

Highlighting the shortage of media companies to be acquired is the drama that unfolded last July. After Sprint Nextel acquired Clearwire, the combined group was in turn acquired by Japan's SoftBank in a bid that involved Dish Network, which lost by offering more value at $25.2 billion but less cash.

In the U.S. last March, Liberty Media spent $2.62 billion to acquire 27.3 percent of St. Louis-based Charter Communications, but lost out trying to get Time Warner Cable involved while still courting the acquisition of New York-based Cablevision. Earlier this year, Charter paid $1.625 billion for a Cablevision subsidiary, Bresnan Broadband, which provides video cable service to more than 300,000 customers in Colorado, Montana, Wyoming and Utah.

Recently, in line with its goal to become a TV platform, the online portal AOL purchased Adap. tv, a video advertising company, for $405 million--a price that Wall Street considered too high.

In terms of programming, the mega merger list is headed by the takeover in Canada of Astral by Bell Media owner BCE for C$3.4 billion. Approval of the deal, announced June 27, is conditional on the sale...

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