An investor group led by Elliott Investment Management and Brookfield Business Partners has inked an agreement to acquire Nielsen Holdings plc for $16 billion.
Nielsen announced the deal this morning. The $16 billion acquisition price amounts to $28 per share, a 60% premium over the last closing price of the company’s stock before its plans for a sale became public.
The acquisition price is $1 billion higher than an earlier bid the same investor group made a few weeks ago. That earlier bid was rejected after a major Nielsen shareholder, WindAcre, notified the company of its “ability and intention” to block the transaction. The Wall Street Journal reported today that WindAcre had been notified in advance about the new $16 billion acquisition agreement.
New York-based Nielsen helps brands measure the reach of their TV ad campaigns. Historically, the company specialized mainly in evaluating the effectiveness of ad campaigns run on broadcast and cable TV channels. Nielsen has in recent years expanded its focus to include streaming platforms and online ads as well.
The company is being acquired in a time when it’s facing growing competition. Over the last few quarters, several major players in the TV industry have either started piloting analytics tools from Nielsen rivals or raised the possibility of creating their own competing technology.
Nielsen’s plans to retain its leadership position in the ad analytics market center on a cloud-based platform called Nielsen One. The company first announced plans for the platform in late 2020 and debuted an early version dubbed Alpha this past January.
Nielsen One will enable brands to centrally track the effectiveness of ad campaigns across TV channels and streaming platforms. According to Nielsen, the platform will collect audience data at intervals of less than a minute to help brands granularly measure ad performance. The company plans to use machine learning to extract insights from the data it collects.
Nielsen One is expected to launch in the fourth quarter of 2022. According to the company, the platform’s features will ease tasks such as comparing the effectiveness of ads across different TV channels and optimizing marketing campaigns.
“Nielsen is deeply embedded in the media ecosystem and a trusted service provider to its customers,” stated Brookfield Business Partners managing partner Dave Gregory. “As a private company, Nielsen will be even better positioned to deliver the best measures of consumers’ rapidly changing behaviors across all channels and platforms.”
The investor group acquiring Nielsen plans to finance the $16 billion acquisition with a combination of debt and a $5.7 billion equity commitment. Excluding Nielsen’s debt, the deal reportedly values the company at about $10 billion.
The acquisition is expected to complete in the second half of 2022. It marks Nielsen’s second exit from public markets: an investor consortium previously took Nielsen private in 2006 for $10 billion. The company became publicly traded again five years later.
Elliot, one of the participants in the investor group taking Nielsen private, is carrying out the deal through its Evergreen private equity arm. Private equity firms often refresh a company’s business strategy after an acquisition to accelerate its revenue growth. In some cases, they encourage the company to make acquisitions of its own to extend its product portfolio.
Earlier this year, Elliot teamed up with Vista Equity Partners to acquire Citrix Systems Inc. for $16.5 billion.