NIELSEN HOLDINGS has signed a definitive agreement to acquire ARBITRON INC.
NIELSEN has agreed to acquire all of the outstanding common stock of ARBITRON for $48 per share in cash, representing a premium of approximately 26% to ARBITRON’s closing price on DECEMBER 17, 2012. NIELSEN has a financing commitment for the total transaction amount. The transaction has been approved by the boards of both companies and is subject to customary closing conditions, including regulatory review.
“U.S. consumers spend almost 2 hours a day with radio. It is and will continue to be a vibrant and important advertising medium,” said NIELSEN CEO DAVID CALHOUN. “ARBITRON will help NIELSEN better solve for unmeasured areas of media consumption, including streaming audio and out-of-home. The high level of engagement with radio and TV among rapidly growing multicultural audiences makes this central to Nielsen’s priorities.”
With ARBITRON assets, NIELSEN intends to further expand its “Watch” segment’s audience measurement across screens and forms of listening. “These integrated, innovative capabilities will enable broader measurement of consumer media behavior in more markets around the world,” said NIELSEN Pres./Global Media Products and Advertiser Solutions STEVE HASKER. “We will also bring local clients greater visibility to empower more precise advertising placement and campaign effectiveness.”
“Radio reaches more than 92% of all American teens and adults because they love to listen to music, talk, news and information while at home, at work and in their cars,” said ARBITRON Pres./CEO WILLIAM T. KERR. “By combining Nielsen’s global capabilities and scale with Arbitron’s unique radio measurement and listening information, advertisers and media clients will have better insights into consumer behavior and the return on marketing investments.”
MEDIA STOCK
David Calhoun must not be too sharp a CEO. Radio TSL per week is 94 minutes and next year will be surpassed by mobile media which this year is right behind at 92 min. per week.
Then again, why anyone would own a media stock is beyond my comprehension.
CALHOUN BUYING RATING SERVICE
I must take exception to Scott’s comment. David Calhoun is not buying a radio station or radio properties. He is buying the ratings service. Nielsen now effectively owns all media ratings outlets. He is taking control of the major area that they did not have….
This is a smart decision to corner the ratings market and make Nielsen the one stop shop for all ratings information.
RADIO PURCHASES OF SURVEYS DECLINING
Solid Sid: Do you honestly think the radio sector is going to INCREASE the number of surveys it purchases? Because if you do, you’ll have the scoop of the decade, since radio purchases of survey data has been in decline for the past decade.
Fewer radio surveys purchased by stations means less revenues. I personally know CEO’s of publicly-traded companies, well-known Wall Street analysts and current/former Arbiton/Nielsen executives who already have told me this is not good for Nielsen stockholders.
Media consolidation in the past 8 years have not delivered long-term ROI for shareholders. I lived in first-hand in 2006 with the Citadel acquistion of ABC radio. Disney was smart. Citadel is history.
Stock and financial analysis experts are rarely wrong for the long-term. These mergers happen because Wall Street banks make them happen with loans they can call in at any time acquiring assets for spin off and liquidation. The banks do well and have cornered the market for profiting from the media sector - letting the media sector eat itself to death.