Nielsen has agreed to be acquired by a private equity consortium in an all-cash transaction valued at around $16 billion, including the assumption of debt. That is 10% more than a previous proposal from the investment consortium, which was rejected. The investors are confident that the new Nielsen ONE measurement system will ensure that the company remains the gold standard currency for trading in television advertising in the United States. Although best known for its television ratings, Nielsen a global consumer research company, with 43,000 employees.
Nielsen, once synonymous for audience measurement, has been criticised for the accuracy of its panel numbers and had its accreditation by the United States Media Rating Council suspended in 2021. The company is promising to deliver a new cross-media measurement system, Nielsen ONE to provide reach and frequency metrics across linear programming and online channels. It is currently being tested and is due to be launch in late 2022 and will fully replace the current panel system in late 2024.
“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,” said James Attwood, who chairs the Nielsen board.
The proposal is led by Evergreen Coast Capital, which is an affiliate of Elliot Investment Management, and Brookfield Business Partners. After months of market analysis, industry diligence and management reviews, the investors say they are convinced that Nielsen “will continue to be the gold standard for audience measurement as it executes on the Nielsen ONE roadmap”.
The transaction is subject to shareholder and regulatory approval. If closing conditions are met, it is expected to complete in the second half of 2022.
The deal provides for a 45-day period in which Nielsen can actively solicit alternative offers and potentially enter negotiations with other parties, although they would have to bear a $102 million termination fee if the company were to accept a better offer.
Nielsen ratings have long been the commercial currency of television in the United States. Nielsen also measures media in almost 50 other countries around the world.
Although Nielsen is best known for its television ratings, almost half of its revenue comes from measuring what people buy in the retail market.
The company was founded in 1923 by Arthur C Nielsen, who pioneered market research and coined the term market share. Nielsen began measuring radio listening in the 1940s and television audiences in 1950.