Digital Media M&A Excitement Shifts to IPO Fever in 2019

Newletter DigitalMedia MAReport Q119

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While M&A and financing activity across the digital media space experienced record growth in 2018, the first quarter of 2019 showcased a slowdown in M&A and financing activity versus the same period in 2018. Compared to Q1’18, Intrepid saw the number of disclosed M&A transactions decrease by 45%, while disclosed M&A transaction value decreased by 77%. The number of financings decreased by 39% and disclosed financing value decreased by 14%. The temporary slowdown in activity was not isolated to digital media. According to Dealogic, the number of M&A transactions, across nearly all sectors worldwide, declined more than 25% from Q1’18 to Q1’19.

Despite the slowdown, key industry trends include:

  • Slowdown in mega-deals, with the industry’s five largest deals announced in Q1’19 accounting for $4.4 billion in total enterprise value, compared to $20.2 billion in Q1’18;
  • Continued growth in firms enabling the shift to eCommerce and digital delivery models, including delivery networks, marketplaces and payment processing platforms;
  • Activity across, and focus on fintech companies and platforms; and
  • Pent up demand for late stage IPOs with significant backlog of new issues.