Third Quarter 2008 M_A Results by alleyinsider

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									For Immediate Release
Third!Quarter!2008!M&A!Overview!

Contact:!!Adam!Gross! Phone:!!212"754"0710! Email:!!adamg@jegi.com!

M&A!Activity!Continues!for!Mid"Sized!and!Smaller!Transactions!for! Media,!Information,!Marketing!Services!&!Related!Technologies! New!York,!NY!October!1,!2008!–!So!far,!2008!is!a!tale!of!two!markets.!!Banking!and!debt!market!upheaval! and! an! incipient! pullback! in! advertising! spending! have! led! to! an! overall! slowdown! in! M&A.! ! However,! mid"sized! and! smaller! transactions,! particularly! in! growth! sectors,! such! as! online! media,! interactive! marketing! services! and! database! information,! have! kept! pace! with! 2007.! ! As! a! result,! while! aggregate! transaction!value!is!down!nearly!70%,!the!total!of!619!M&A!transactions!announced!through!the!first!nine! months! of! 2008! is! within! a! few! percentage! points! of! the! total! number! for! the! same! period! in! 2007,! for! media,! information,! marketing! services! and! related! technologies,! as! tracked! by! The! Jordan,! Edmiston! Group,!Inc.!(JEGI).!

Source: JEGI Transaction Database

Billion"dollar"plus!leveraged!transactions!have!largely!gone!on!hold,!such!as!the!acquisition!of!Informa!by! a! consortium! of! Blackstone,! Carlyle! Group,! and! Providence! Equity! Partners.! ! Strategic! buyers,! which! completed!nearly!85%!of!transactions!so!far!in!2008,!continue!to!focus!on!smaller!opportunities!that!offer! complementary! revenue! and! products,! new! management! talent,! and! expertise! in! growth! areas.! ! These! transactions! are! being! funded! directly! off! their! balance! sheets,! and! do! not! require! external! financing.!!
150 East 52nd Street, 18th Floor, New York, NY 10022 212-754-0710 • www.jegi.com

However,! private! equity! firms! are! in! control! of! $450! billion! of! uninvested! capital! worldwide,! providing! considerable!buying!power!for!those!willing!to!embrace!transaction!structures!with!a!greater!equity!to!debt! mix.!!!!! M&A!deal!activity!this!year!has!been!dominated!by!the!growth!areas!of!Online!Media!&!Technology!and! Marketing!&!Interactive!Services.!!Combined,!these!sectors!saw!423!transactions,!with!a!total!value!of!$15! billion,!approximately!70%!of!volume!and!more!than!50%!of!deal!value!for!the!first!nine!months!of!2008.!!!! JEGI!has!remained!very!active,!having!closed!14!transactions!year"to"date.!!Third!quarter!closings!included! the! acquisition! of! JupiterResearch! by! Forrester! Research;! the! sale! of! University! Health! Publishing! to! MediZine! (a! portfolio! company! of! Veronis! Suhler! Stevenson);! and! the! sale! of! dmg! world! media’s! North! American!Consumer!Home!Shows!to!Marketplace!Events!(backed!by!Stephens!Capital).!

Media, Information, Marketing Services & Related Technologies M&A Activity
2008
January - September Industry Sector No. of Deals Value ($MM) No. of Deals

2007
January - September Value ($MM) No. of Deals Value

Business-to-Business Magazines Consumer Books Consumer Magazines Database Information Services Directory & Reference Publishing Educational & Professional Publishing Exhibitions & Conferences Marketing & Interactive Services Newsletter Publishing Newspaper Publishing Online Media & Technology Total
Source: JEGI Transaction Database

20 4 33 36 7 12 40 205 11 33 218 619

394 28 165 8,645 295 286 712 7,271 153 936 7,774 26,659

31 8 46 22 10 20 51 181 4 31 232 636

3,129 220 3,271 21,287 2,747 14,239 733 20,084 139 13,358 8,350 87,557

(35.5%) (50.0%) (28.3%) 63.6% (30.0%) (40.0%) (21.6%) 13.3% 175.0% 6.5% (6.0%) (2.7%)

(87.4%) (87.3%) (95.0%) (59.4%) (89.3%) (98.0%) (2.9%) (63.8%) 10.1% (93.0%) (6.9%) (69.6%)

M&A!Highlights! ! M&A!activity!for!the!business"to"business!magazine!sector!slowed!in!number!of!deals!(down!36%)! and! value! (down! 87%)! versus! 2007! levels! for! the! first! nine! months! of! 2008.! There! were! no! significant!transactions!in!the!third!quarter,!with!the!sale!of!Randall"Reilly!Publishing!to!Investcorp! being!the!largest!for!the!year!at!less!than!$200!million.! Similarly,! the! consumer! magazine! sector! saw! a! 28%! decrease! in! the! number! of! deals! and! a! 95%! decline!in!value,!with!no!substantial!transactions!for!the!year.!!!

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Database!and!information!services!was!one!of!the!most!active!sectors!over!the!past!three!quarters,! with!a!64%!increase!in!number!of!deals!over!2007!levels.!!Nominal!transaction!values!declined,!but! excluding!Thomson’s!$18+!billion!acquisition!of!Reuters!from!2007!data,!deal!value!for!2008!more! than!doubled!over!2007.!!Notable!transactions!that!occurred!in!the!third!quarter!included!Wolters! Kluwer’s!acquisition!of!UpToDate!for!$375!million!and!IHS#s!acquisition!of!Global!Insight!for!$200! million.!! The! educational! and! professional! publishing! sector! showed! decreases! in! number! of! deals! and! total!deal!value!of!40%!and!98%,!respectively.!With!no!$1+!billion!transactions!in!2008,!average!deal! size!fell!to!$24!million.!!! The! exhibitions! and! conferences! sector! experienced! a! decrease! of! 22%! in! the! number! of! transactions,!but!value!remained!relatively!flat!compared!to!the!same!period!in!2007.!!JEGI’s!sale!of! dmg! world! media’s! portfolio! of! 38! North! American! Consumer! Shows! for! $53! million,! along! with! several! other! JEGI! event! transactions,! contributed! to! this! sector! performing! well,! as! diversified! media!companies!and!investors!recognized!the!ongoing!strength!of!live!events.!!!! M&A!activity!for!marketing!and!interactive!services!continued!at!a!healthy!pace,!with!the!number! of!deals!up!13%.!!Value!for!announced!transactions!reached!$7.3!billion!for!the!first!nine!months!of! 2008,! although! off! more! than! 60%! due! to! the! wave! of! mega"deals! in! the! same! period! in! 2007.!! Notable! third! quarter! announcements! included! Microsoft’s! acquisition! of! Greenfield! Online! and! subsequent!resale!of!part!of!the!business!to!ZelnickMedia,!and!Forrester!Research’s!acquisition!of! JupiterResearch.!! The!number!of!newsletter!transactions!nearly!tripled!in!the!first!nine!months!of!2008!over!the!same! period! of! 2007,! as! strategic! companies! and! private! equity! portfolio! companies! increased! their! activity! in! this! sector.! ! Notable! transactions! in! the! third! quarter! of! 2008! included! JEGI#s! sale! of! University!Health!Publishing!to!MediZine,!a!VSS!portfolio!company,!and!John!Wiley#s!acquisition! of!LRP!Publications.!!! The!number!of!deals!announced!in!the!newspaper!sector!increased!7%!to!33!in!the!first!nine!months! of!2008.!!However,!deal!value!declined!93%!for!the!sector!versus!2007!levels,!as!there!have!been!few! notable!newspaper!deals!in!2008!and!none!in!the!third!quarter.!!! Activity!in!the!online!media!and!technology!sector!remained!healthy,!with!218!deals!announced,! valued!at!$7.7!billion.!!Strategics!boosted!deal!volume!in!the!third!quarter!by!continuing!the!trend! of!acquiring!emerging!social!media!and!online!content!companies.!!For!the!quarter,!notable!deals!in! this! sector! included! the! sale! of! Napster! to! Best! Buy! for! $53! million! and! Comcast’s! acquisition! of! DailyCandy!for!$125!million.!!However,!the!greatest!surge!in!volume!was!in!niche!online!content! businesses,!typically!for!less!than!$5!million,!as!the!market!for!small!sites!became!more!liquid!and! strategic!buyers!continued!to!seek!complementary!add"ons.!

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150 East 52nd Street, 18th Floor, New York, NY 10022 212-754-0710 • www.jegi.com

About!JEGI! The! Jordan,! Edmiston! Group,! Inc.! (JEGI)! of! New! York,! NY! is! the! leading! provider! of! independent! investment! banking! services! for! media,! information,! marketing! services! and! related! technologies.! Since! being! founded! in! 1987,! JEGI! has! completed! nearly! 500! high"profile! M&A! transactions! for! global! and! emerging! companies;! entrepreneurial! owners;! and! private! equity! and! venture! capital! firms.! ! JEGI! has! established!an!impeccable!reputation!in!the!marketplace,!which!reflects!its!superior!performance!on!behalf! of! its! clients.! ! The! firm#s! executive! team! of! investment! bankers! has! extensive! senior"level! industry! experience!across!the!markets!that!JEGI!serves.!!For!more!information,!visit!our!web!site:!www.jegi.com!! ###!


								
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