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Nielsen Arbitron Deal Cleared

September 23 2013

The FTC has announced it has reached an agreement with Nielsen, allowing the latter's acquisition of Arbitron to go through, with a condition safeguarding Arbitron's September 2012 cross-platform project with comScore and broadcaster ESPN.

Nielsen Arbitron Deal ClearedSubject to customary closing conditions the acquisition - valuing Arbitron at $1.26bn or $48 per share and first announced last December - is now expected to close a week from today.

Nielsen says the condition imposed by the FTC 'does not affect the strategic rationale of the acquisition or the anticipated benefits', and says the deal will 'enable broader measurement of what consumers are watching and listening to around the world and deeper measurement of multicultural audiences in the US'. It will also expand advertising effectiveness for radio clients and boost coverage of 'unmeasured areas of media consumption, such as streaming audio and out-of-home'.

Nielsen says it expects $0.26 of accretion to adjusted net income per share in the first full year of operations, and $0.32 after year two.

The condition asks Nielsen to find a third party Licensee acceptable to the FTC (comScore, if chosen, has already been approved) to sign a 'Remedial Agreement' for the continued provision of Arbitron services involved in the Project Blueprint cross-platform project developed by Arbitron, ESPN and comScore last year and delivering a cross-platform view of ESPN content. Former Arbitron employee Jay Guyther is appointed as Monitor of this condition, overseeing Nielsen's compliance. The Arbitron services in question must be made available for the project for a period of eight years. If Nielsen fails to find a Licensee within three months, the FTC may appoint a Trustee to find one sometime in the following 9 months.

The services Arbitron must continue to provide are radio and TV PPM data, and data from the Calibration Panel, a subset of 2,000 PPM panelists who have downloaded comScore's online meter and provide data on viewing behavior across radio, TV and online. Nielsen must also transfer to the Licensee Arbitron's interest in the Link Meter technology developed for Project Blueprint, linking PPM and calibration panel measurements. Nielsen may charge the Licensee its Direct Cost for providing the services. The future employment of seven Arbitron employees who were involved in Project Blueprint is also covered by the terms.

Nielsen CEO David Calhoun comments: 'We are pleased to have the regulatory process behind us and are excited to be closing the Arbitron acquisition. We are looking forward to providing all of the benefits of the combined company to our new clients in the radio industry and their advertisers, driving incremental value for them as well as our shareholders.' Nielsen will proceed with its own cross-platform measurement initiatives, and Calhoun says the deal 'doesn't change the market landscape'.

Web sites: www.nielsen.com , www.arbitron.com and www.ftc.gov .

All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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