As 2017 draws to a close, Steve Monnington of Mayfield Media Strategies looks back over the year’s M&A highlights.
Every month Steve Monnington, owner of Mayfield Media Strategies, provides EN readers with a unique glimpse into the high-flying world of international exhibition mergers and acquisitions. For this issue, we caught up with Monnington for a look back over 2017’s M&A activity, and some insights into the year ahead.
Has 2017 been a busy year for mergers and acquisitions?
Unless there is a flurry of activity in the last quarter, the number of exhibition transactions in 2017 is set to be lowest in the last five years. There were 73 reported deals in 2016 and only 45 so far this year. This is mainly due to a decrease in the number of US transactions from 2016 (28) to 2017 (12 to date) and a slow down in M&A activity in the UK. There aren’t many independent businesses still to acquire but entrepreneurs are constantly launching new ventures, so I don’t see this as a long-term issue.
Which countries are the most active?
Despite the decrease in activity, the US and UK consistently account for more than 50 per cent of the total worldwide transactions each year and 2017 is no exception. In emerging markets such as China, Turkey, Southeast Asia and Latin America, most of the obvious businesses have already been acquired so M&A activity in these geographies has been low for a few years now.
Which organisers have been particularly active in terms of M&A?
I think the most interesting fact is that the 45 transactions this year involve 31 different buyers. In the past Reed and UBM dominated the M&A scene but this year UBM in particular have been very quiet following some pretty significant acquisitions such as Advanstar in the US and AllWorld in Asia. The most active are the Private Equity-owned organisers, primarily Comexposium and Clarion and also Emerald in the US who became a publicly listed company recently.
Have there been any deals that have surprised you this year?
Last year, the big surprise was the sale of AllWorld to UBM. This year it was the de-listing of Hong Kong-based Global Sources from Nasdaq and the subsequent acquisition by private equity firm Blackstone. I’m not clear where the growth in that business will come from and what Asian acquisitions they might be able to unlock to create a credible buy-and-build strategy. Blackstone also acquired Clarion this year but I don’t believe that the two deals were the result of an overall strategy.
Have you seen any M&A trends?
This has been the year of non-core disposals. Ascential, Centaur, Informa and UBM have all sold non-strategic parts of their businesses. This is healthy as it gives a chance for the events to be revitalised by new owners. I’m sure that we will see more portfolio pruning in the coming months.
Which organisers might be ‘ones to watch’ for 2018?
There will be the usual speculation of when PE firms exit – and inevitably sell on to another PE firm. It’s been two and a half years since Charterhouse invested in Comexposium and Inflexion acquired CloserStill Media and investment timeframes seem to be getting shorter. In terms of non PE-owned organisers I would watch Montgomery, who have already flagged their expansion plans by both launch and acquisition. I also believe that dmg are likely to accelerate their M&A activity.