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Nielsen To Be Acquired by Private Equity Group for $16B

Consortium of investors previously had proposed $9B takeover

This story was originally published by our sister publication TV Technology. 

Nielsen Holdings announced today that it has agreed to be acquired by a private equity consortium led by Evergreen Coast Capital Corp., an affiliate of Elliott Investment Management and Brookfield Business Partners for $28 per share in an all-cash transaction valued at approximately $16 billion, including the assumption of debt.

The deal comes a week after Nielsen turned down a $9 billion offer by the same group, saying that the proposed transaction “significantly undervalues” the company’s worth.

Nielsen has also come under increasing pressure to evolve its media measurement platform to improve its monitoring of the increasing array of media streaming options. In one of the most public demonstrations of the lack of confidence in the company, several companies and networks owned by Byron Allen filed a civil suit earlier this month against Neilsen. alleging that its “outdated and unreliable” ratings significantly undercounted audiences, particularly for smaller networks, and that Nielsen’s inaccurate audience measurement cost media companies “billions of dollars.”

In January, the Video Advertising Bureau released a study that found Nielsen’s undercounting of audiences resulted in major losses for TV broadcasters totaling upwards of $700 million during a 16 month period. In response, Nielsen said that after reviewing VAB’s data that “while we acknowledge the understatement in a portion of our National out-of-home audiences, we stand by our prior statements that the magnitude of the issue was very small for the majority of telecasts.”

The study was released just months after the Media Rating Council (MRC) removed its accreditation of Nielsen’s national and local TV measurement services. The company has made several efforts to improve its image by expanding coverage offered by Nielsen Media Impact (NMI), its national media planning and optimization solution, to include streaming data from connected television sets (CTV) as well as launching “Streaming Signals,” what the company calls a “first of its kind” solution for connected TV (CTV) operators and advertisers to better understand who is watching a show within the household.

The Nielsen Board of Directors voted unanimously to support the acquisition proposal, which represents a 10% premium over the consortium’s previous proposal and a 60% premium over Nielsen’s unaffected stock price as of March 11, 2022, the last trading day before market speculation regarding a potential transaction.

“After a thorough assessment, the Board determined that this transaction represents an attractive outcome for our shareholders by providing a cash takeout at a substantial premium, while supporting Nielsen’s commitment to our clients, employees and stakeholders. The Consortium sees the full potential of Nielsen’s leadership position in the media industry and the unique value we deliver for our clients worldwide,” said James A. Attwood, Chairperson of Nielsen’s Board of Directors.

“After months of deep market analysis, industry diligence and management reviews, we are firmly convinced that Nielsen will continue to be the gold standard for audience measurement as it executes on the Nielsen ONE roadmap,” said Managing Partner Jesse Cohn and Senior Portfolio Manager Marc Steinberg on behalf of Evergreen and Elliott. “Having first invested in Nielsen nearly four years ago, we have a unique appreciation for the Company’s ongoing relevance to the global, digital-first media ecosystem. Today’s outcome represents a significant win for Nielsen’s shareholders and for the business itself, as our multibillion-dollar investment will help Nielsen reinforce its transformation at this critical inflection point. We are pleased to partner with David and the existing management team to lead Nielsen after the transaction is completed.”

“Nielsen is deeply embedded in the media ecosystem and a trusted service provider to its customers. 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,” commented Dave Gregory, Managing Partner, Brookfield Business Partners. “We are pleased to invest in this iconic company and help lead the industry into the next generation of audience measurement.”

The Consortium has secured fully committed debt and equity financing, including an approximately $5.7 billion equity commitment from the consortium consisting of Evergreen and Brookfield.

The transaction is subject to approval by Nielsen shareholders, regulatory approvals, and is also subject to UK court approval. If the closing conditions are met, the transaction is expected to close in the second half of 2022.

The transaction agreement provides for a “go-shop” period, during which Nielsen – with the assistance of its financial advisors, J.P. Morgan and Allen & Company, and its legal advisors – will actively solicit, evaluate and potentially enter into negotiations with parties that offer alternative acquisition proposals. The go-shop period expires 45 days after Nielsen’s entry into the transaction agreement.

Following that period, Nielsen will be permitted to continue discussions and enter into or recommend a transaction with any person or group that submitted a qualifying proposal during the 45-day period, if the Board determines the proposal is superior to this transaction. A competing bidder who makes a superior proposal would bear a $102 million (1% percent of equity value) termination fee that is payable by Nielsen if Nielsen terminates the transaction agreement with the consortium to accept such superior proposal.