Dive Brief:
- Nielsen agreed to be acquired by a private equity consortium in an all-cash deal valued at $16 billion, including the assumption of debt, according to a company announcement. The deal is expected to close in the second half of 2022 and remains subject to shareholder and regulatory approval.
- The consortium headed by Evergreen Coast Capital and asset management firm Brookfield has secured full financing for the transaction. However, Nielsen has entered a 45-day "go-shop" period during which it can actively solicit offers from other bidders with the help of its financial advisors, J.P. Morgan and Allen & Company, and legal advisors.
- Evergreen is owned by Elliott Management, which first took a stake in Nielsen four years ago and previously pushed the company toward a sale. The move to go private comes as Nielsen faces intense pressure after flubbing some of its ratings during the pandemic, which has resulted in fallout with key network partners and other stakeholders.
Dive Insight:
Nielsen's sale tees up substantial changes for the legacy media measurement firm, which has faced increasingly tough questions about its business model during a transformational period for TV viewing. News of the deal was first reported in The Wall Street Journal.
"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," Dave Gregory, a managing partner at Brookfield, said in a press statement around the acquisition.
Nielsen turned down an offer from the private equity consortium led by Evergreen and Brookfield earlier this month, believing it was undervalued. The company ultimately managed to lock in a higher price tag — one that represented a 60% premium on its unaffected stock price as of March 11 — and has the flexibility of engaging other bidders through the go-shop period. Nielsen would still have to pay a $102 million termination fee if it broke off the agreement with the consortium.
Nielsen has made other deals to streamline operations. Two years ago, it sold its Global Connect business focused on retail measurement for around $3 billion to Advent International, another private equity shop. The unit started operating under the name NielsenIQ in 2021.
Nielsen's core business has struggled amid a decline in TV ratings and the rise of a fragmented streaming market that's mandated a fresh approach to measurement. Cross-channel measurement is not an egg many have cracked, but the desire for alternative methods among marketers and networks has brought greater competition to the industry.
Nielsen's troubles reached a flashpoint last year when it admitted it had undercounted out-of-home audiences for national TV programming since September 2020. The hiccup was attributed to a software issue but resulted in outrage from clients. Nielsen subsequently lost its accreditation from the Media Rating Council, a key industry watchdog, and continues to experience fallout from the controversy.
NBCUniversal at its upfront presentation in March announced it was elevating iSpot.tv, a Nielsen rival, as a currency for national ad buys. The news was viewed as a major blow to Nielsen, but maybe not an unexpected development. The network previously tested iSpot.tv's offerings around the Olympics and Super Bowl, two of TV's biggest destination viewing events.
Nielsen plans to roll out a solution that touches across TV and digital platforms, called Nielsen One, sometime this year.
