Ratings Merger: Nielsen Buying Arbitron

The $1.26 billion deal expands Nielsen into radio measurement. CEO David Calhoun: “The high level of engagement with radio and TV among rapidly growing multicultural audiences makes this central to Nielsen’s priorities.”

Nielsen Holdings N.V. today announced that it has signed a definitive agreement to acquire Arbitron Inc.

Nielsen said it has agreed to acquire all of the outstanding common stock of Arbitron for $48 per share in cash (about $1.26 billion), representing a premium of approximately 26% to Arbitron’s closing price on Dec. 17. 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 two 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’s assets, Nielsen said it 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 Steve Hasker, Nielsen president of global media products and advertiser solutions. “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 William T. Kerr, president-CEO of Arbitron. “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.”

Together, Nielsen and Arbitron generated total revenues of $6 billion and combined pro forma adjusted EBITDA of $1.7 billion based on the 12 months ended Sept. 30. Nielsen said the combined assets “will support Nielsen’s strong cash flow characteristics and will enable continued investment in growth initiatives.”

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Excluding estimated transaction costs and purchase accounting adjustments, the acquisition is expected to be approximately $0.13 accretive to adjusted EPS 12 months after the close and approximately $0.19 accretive to adjusted EPS 24 months after the close.

Cost synergies associated with the acquisition, Nielsen said, are expected to be at least $20 million and will be largely driven by the integration of technology platforms and data acquisition efforts.


Comments (5)

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Angie McClimon says:

December 18, 2012 at 10:29 am

Why attempt to compete when you can just buy?

Eugene Thompson says:

December 18, 2012 at 11:47 am

Interesting! Now Nielsen can deploy Arbitron’s PPM technology to capture TV usage on the go, including listening to broadcast TV programming in motor vehicles which are new rooms of our TV Households. HD Radio will benefit.

ABELARDO BLANCO says:

December 18, 2012 at 1:52 pm

Oh goody..now there are two marginal, out of date systems merging to make one bigger expensive disappointment. Yee-ha!

    Sandy Pudar says:

    December 19, 2012 at 12:03 am

    Thats so true! Maybe thats why they had a massive lay off !! they need to pay for this merger…ha

Ashley M. Heher says:

December 19, 2012 at 2:59 pm

Over the many years I covered media, I’ve seen Nielsen avoid having to improve itself by buying up any competition, good, bad or otherwise. Arbitron was the last holdout. Now there is no hope for better ratings data.


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