PwC: Deal Volumes, Values Rise in Q3

Media and telecom deal volumes and values were up significantly in the third quarter, fueled by a growing belief that lighter regulation and economic benefits will prevail, according to a PricewaterhouseCoopers report.

Volumes rose 9% to 238 deals in Q3, their highest point in the past two years, compared to Q2 this year, according to PwC's Q3 2017 Deal Insights report. Values topped $31.6 billion, up 76% form the second quarter and fueled by seven megadeals. PwC defines megadeals as transactions above $1 billion in value. Leading that list was Discovery Communications’ pending $11.8 billion purchase (not including debt) of Scripps Networks Interactive.

According to PC, the Advertising and Marketing sector made up for the biggest chunk of volume – about 80 deals. In the Broadcasting sector deal volume rose 50% to 13 deals. The Broadcast and Telecommunications (42 deals) sectors, both hit two-year highs as well.  

“While the shift to digital was all the rage only a couple of years ago, market participants are realizing that a compelling digital platform may only be part of the solution and won’t satisfy sophisticated investors and stakeholders,” PwC wrote. “The ultimate goal: taking that sticky digital platform you’ve built or acquired and maximizing the underlying data to (i) improve customer engagement and (ii) identify direct or tangential service offerings, which can improve the monetization of said user base.”

Rounding out the megadeals were Crown Castle International’s $7.1 billion purchase of Lightower Fiber Networks (Telecom); and two sports franchise deals: Tilman Fertitta’s $2.2 billion acquisition of the NBA’s Houston Rockets and an investor group’s (led by Bruce Sherman and former New York Yankee Derek Jeter) purchase of the MLB Miami Marlins for $1.2 billion (Recreation and Leisure).

In the Internet & Information sector, The Walt Disney Co.’s $1.6 billion purchase of a majority stake in BAMTech led the pack,  while Atlantic Broadband Group’s $1.4 billion purchase of Metrocast Cablevision rounded out the Telecom list.