Petsky Prunier: First Half Sets Record for M&A Activity

Share this content:
A jump in the average value of merger and acquisition transactions in the first half of 2005 helped make the period one of the strongest on record for the direct marketing industry, investment bankers Petsky Prunier LLC said yesterday.

Direct marketing M&A activity in the first half totaled 216 transactions while dollar volume rose 30 percent to $18.3 billion in estimated transaction value, a half-year record, according to Petsky Prunier. Average transaction size was $84.7 million, up 63 percent from last year. Also, private equity groups accounted for 32 percent of M&A deals, up from 21 percent last year.

The New York-based company, which advises on mergers and acquisitions in the DM sector, publishes its Marketing Services & Technology and Multichannel Marketer Deal Notes twice a year.

Several factors are driving the trend toward increased activity, larger deals and a mood of assertiveness, according to the report, including the desire to add new products and/or services, as exemplified by's $40 million acquisition of baked gifts company Cheryl & Co. Another factor is the need to add new customers, which drove E.W. Scripps' $560 million acquisition of shopping comparison engine Wanting to branch into new channels and add capabilities along the value chain in order to better control the customer experience also contributed to the increased M&A activity.

On a segment basis, marketing services companies were involved in 115 transactions in the first half, with a total estimated value of $8.4 billion, a 62 percent gain over last year. Interactive advertising and related segments were the most active. Hellman & Friedman's $1.1 billion acquisition of DoubleClick was the second quarter's largest transaction. Other large deals included eBay's purchase of and Experian's $380 million buy of online lead generation company

Three of the four largest marketing services deals thus far have been search engines: Ask Jeeves, which was acquired by InterActiveCorp for $1.9 billion, the E.W. Scripps-Shopzilla deal and the deal.

Marketing technology companies were involved in 59 transactions with a total estimated value of $3.2 billion, an 18 percent gain over last year.

The marketing technology sector's largest deal in the second quarter was eFunds' $310 million acquisition of prepaid and stored-value products provider WildCard Systems. In addition, eFunds acquired National Check Protection Services and ClearCommerce during the first half, putting it on track to becoming a consolidated provider of account lifecycle solutions to the financial services and retail industries.

Transactions involving multichannel marketers in the first half numbered 42, or 19 percent of total DM transactions for the period. However, the multichannel marketer sector's total estimated $6.7 billion in deal value represented 37 percent of the DM industry's dollar volume. The average multichannel marketer deal size was $160 million, more than double the average of marketing services and marketing technology sector transactions.

The second quarter's largest multichannel marketer deal was Bain Capital's acquisition of public company School Specialty for $1.5 billion. Other notable deals included Sabre Holdings Corporations' purchase of for $1.1 billion, BMG Direct's acquisition of Columbia House for $400 million, General Atlantic's purchase of for $250 million and the $188 million buyout of Potpourri Group by American Capital Strategies.

Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting


Next Article in Multichannel Marketing

Sign up to our newsletters

Company of the Week

PAN Communications is an award-winning integrated marketing and public relations agency for B2B technology and healthcare brands. PAN's data-driven approach allows the firm to specialize in public relations, social media, content and influencer marketing, and data and analytics. PAN partners with brands to create unique, integrated campaigns that captivate audiences and drive measurable results. PAN services clients out of the firm's four offices: Boston, San Francisco, New York City and Orlando.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above