A consortium of private equity firms, including Elliott Management Corp., is in preliminary talks to buy television ratings firm Nielsen Holdings NLSN’s 30.50% PLC for about $15 billion, including debt, according to people familiar with the matter.
Financing talks with a number of banks are ongoing, people said, and the takeover could be completed within weeks. There is no guarantee that a deal will be made, as negotiations may still fall through.
If it were, it would be significant. On Monday morning, Nielsen’s market value was $6.2 billion and the value of the enterprise, known as enterprise value, was over $11 billion, given its huge debt load of over $5 billion.
Other details, including a potential price per share, were not available. Nielsen shares rose more than 30% on Monday to $22.85 a share after The Wall Street Journal reported on the talks.
For years, Nielsen has been synonymous with US television ratings measurement, which provides audience estimates that networks use to sell ad time and reassure advertisers that they got what they paid for. But its influence is waning as streaming gains momentum and traditional broadcasting and cable television lose viewers. Although the New York-based company has introduced streaming metrics in recent years, it is one of the many players in the field.
As a result, Nielsen shares have not performed well. Closing on Friday at $17.51, they are down from a high of over $55 in 2016. They had been on a downward trend for several years when the pandemic caused them to plummet in early 2020. While they have regained some ground, they are still trading slightly lower than they were before Covid-19.
Elliott has owned a stake in Nielsen since 2018, when he urged the company to explore a sale. The following year, Nielsen said it would split some of its business and create two separate public companies: Global Connect, a market-based analytics operation that measures retail and consumer behavior, and a core media business.
In April 2020, Elliott entered into a settlement agreement with Nielsen in which the company agreed to add a director and form a finance committee on the board of directors to oversee strategic plans, including the spin-off. At the time, Elliott had about a 13% economic stake in Nielsen.
Global Connect was sold last year to private equity firm Advent International Corp. for nearly $3 billion and is now known as NielsenIQ.
Elliott has been increasingly active in private equity, with its private equity arm, Evergreen Coast Capital Corp. agreed with a partner to purchase cloud computing company Citrix Systems Inc. for $16.5 billion, including debt. It was the latest in a recent string of large leveraged buyouts, with private equity firms looking to use their mountain of cash.
Nielsen was previously acquired in 2006 by a group of private equity firms that included Blackstone Inc., Carlyle Group Inc., KKR & Co. and Thomas H. Lee Partners LP. It went public again in 2011.
If the deal goes through, it will, as merger volume has slowed overall as a result of market volatility and Russia’s invasion of Ukraine. Global merger activity is down about 30% this year compared to the same period in 2021, with about $776 billion worth of deals announced, according to Dealogic.
Write to Dana Cimilluca at [email protected] and Cara Lombardo at [email protected]
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