TechCES Recap: Google's Removal of Third-Party Cookies in the Midst of a...

CES Recap: Google’s Removal of Third-Party Cookies in the Midst of a Storm

Stay updated on Digiday’s annual coverage of the Consumer Electronics Show (CES) in Las Vegas. More from the series →

The fast-evolving digital media sector will be front and center at CES this week. Some are predicting a renewed period of mergers and acquisitions in the space starting in 2023, a quiet period compared to the flurry of corporate development immediately following the Covid-19 pandemic.

According to the annual market report this week from investment bank LUMA Partners, the total value of global deals in the space dropped to its lowest level in 10 years in 2023, with a total deal value of less than $3 billion, a 17% decline from the previous year.

Interest Rate Stabilization

Prohaska Consulting M&A expert Mark Wright told Digiday that lofty valuations were hard to come by in 2023, as potential buyers such as private equity firms felt the growing tide of rising interest rates.

“For the buying side, the cost of debt to finance acquisitions was very high,” he said. “PE firms typically buy companies with a combination of investor cash and debt to juice return multiples.”

Boris Fridman, managing director of marketing tech & data at advisory firm Madison Alley Global Ventures, believes that interest rate stabilization in 2024 could reverse this trend.

“Rising equity markets and the cost of debt financing, which is beginning to come down, add fuel to the fire,” added Wright of Prohaska Consulting. “If rising equity markets and falling debt costs aren’t a head fake, expect M&A in the space to take off in 2024.”

Continued PE Interest

Meanwhile, Fridman also noted how the comparative lack of public listings has blocked access to liquidity for potential buyers. “This has prevented liquidity for many strategic buyers, but of course in 2023, there were fewer acquisitions, but there were still some PE-led purchases,” he adds, pointing to deals like MiQ, backed by Bridgepoint, acquiring Grasp in 2023.

Similarly, Bridgepoint also took a stake in Equativ, a French ad tech company, while other examples include the Novacap acquisition of Cadent for $600 million.

Wright of Prohaska Consulting contends that the trend toward ad tech supply chain inefficiency—likely spurred by the decline of third-party cookies—will intensify.  » …
Read More rnrn

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Subscribe Today

GET EXCLUSIVE FULL ACCESS TO PREMIUM CONTENT

SUPPORT NONPROFIT JOURNALISM

EXPERT ANALYSIS OF AND EMERGING TRENDS IN CHILD WELFARE AND JUVENILE JUSTICE

TOPICAL VIDEO WEBINARS

Get unlimited access to our EXCLUSIVE Content and our archive of subscriber stories.

Exclusive content

Latest article

More article