03 July 2018
| Natalie Bannerman
M&A activity in the media sector has reached historic highs in the first half of 2018 driven by deals like the billion-dollar bidding war for Rupert Murdoch’s Twenty-First Century Fox.
According to data from Thomson Reuters Deals Intelligence,
the value of global media deals has risen to $2.5 trillion
year-to-date, up 64% compared to the same period in 2017.
Before this the highest it reached was $2.3 trillion in
Commenting on the data, Heran Cristerna, co-head of global
M&A at JPMorgan Chase & Co said to Reuters:
"Companies are moving fast rather than dragging their
As for proposed media M&A, the sector currently sits at
around $322.5 billion for the year, more than six times higher
than the same period in 2017.
Bankers say that more consolidation is on its way after the
AT&T and Time Warner acquisition was approved by a federal
judge with little to no conditions. It was this decision
that prompted Comcast to present its $65 billion all-cash
counter offer for Fox only last month.
At the time Comcast chairman Brian Roberts said that the
company is "highly confident that our proposed transaction will
obtain all necessary regulatory approvals in a timely manner
and that our transaction is as or more likely to receive
regulatory approval than the Disney transaction."
The data also suggests that while technology companies have
yet to take part in the media M&A activities, because of
its entry into video subscription services that may soon be the
"The large tech platforms, such as Amazon, Netflix and
Alphabet, have become very credible competitors to the media
and telecom companies, and are certainly creating a lot of
pressure on them," said George Boutros, CEO of investment bank
Qatalyst. "This was a factor in the judge’s
approval of the AT&T/Time Warner deal."
The knock-on effect of the growing number of media M&A
deals is that it spreading to various other sectors. In
telecoms, Sprint and T-Mobile closed its long-awaited merger
that will create a new $146 billion company.
In addition, industry veteran
Alexandre Pébereau launched his new company Tofane
Global with the acquisition of two large international
businesses. The first being KP’s wholesale
division iBasis and the Altice Group.
Elsewhere divestitures has also impacted global M&A.
General Electric announced a wide-scale plan to divest
$20 billion worth of assets from its healthcare unit and its
stake in Baker Hughes.
Speaking to Reuters, Allison Schneirov, partner in M&A
group at Skadden, said: "Companies are continuing to use
M&A in order to evolve and grow, but at the same time
divesting assets to narrow their strategic focus and channel
their funds to core areas".
Regionally, the US topped global M&A activity increasing
by 82% to $1 trillion with Europe close behind with announced
deals nearly doubling to $767 billion in the first half of