Nielsen is to buy Harris Interactive for around $116.6m, or $2 a share. The deal was unanimously approved on Monday by the Board of Directors of Harris, which has recently improved profits despite a continuing slide in its revenues.
The deal is expected to close in the first quarter of next year, but is subject to certain conditions, including the tender of a majority of the outstanding shares.
Harris President and CEO Al Angrisani (pictured), who was drafted back in in May 2011 to lead a turnaround of the struggling firm, said the deal reflected the ‘successful completion’ of the turnaround strategy and would ‘deliver to Harris Interactive stockholders meaningful value and liquidity immediately upon closing.’ Angrisani said the Board selected the Nielsen transaction following a thorough review of the company's strategic alternatives that began earlier this year.
Under the merger agreement, Nielsen will commence a tender offer to acquire all of the outstanding shares of Harris Interactive's common stock through a wholly owned subsidiary formed for the purpose. Holders of outstanding shares of Harris’ common stock will receive $2.00 per share in cash, subject to adjustments defined in the agreement.
The $2.00 per share price represents a 2.0% premium to the stock's volume weighted average closing price in the previous 60 days of trading. Between 2009 and 2012 Harris endured warnings and the threat of delisting from the Nasdaq due to spending long periods with its share price below a dollar, before Angrisani’s measures began to restore the firm’s profitability.
A number of Harris Directors, with shares totalling 12% of common stock, have agreed to tender all of their shares pursuant to the tender offer.
The deal follows Nielsen’s audience measurement mega-merger with Arbitron, completed in September, and will bring its turnover ever closer to the $6bn dollar mark. Nielsen paid $1.26bn - more than ten times the Harris price - for Arbitron, whose revenue in 2005 was $310m, while Harris’ in 2005-6 was $216m.
Of the potential for the combined firm, Angrisani said: ‘By combining Nielsen's global capabilities and scale with Harris Interactive's extensive industry and research expertise, we'll be able to drive outcomes and innovate to bring new methods to understanding consumers around the world.’ The company’s recent innovations include collaboration with Google and the development of QuickQuery instant (QQi), which combines expert survey design guidance with the search giant’s DIY tool Google Consumer Surveys.
For Nielsen, President, Americas John J. Lewis commented: ‘For our existing CPG and media clients, our combined capabilities will provide better and more integrated insights to help them drive business outcomes. Harris Interactive's strength with other industry verticals allows us to serve these clients with Nielsen's differentiated solutions in areas such as marketing effectiveness, social and digital to achieve our growth objectives.’
Web sites are at www.harrisinteractive.com and www.nielsen.com .