Merger and acquisition activity in the media and telecommunications business slowed in the fourth quarter, leaving dealmaking down for all of 2019, according to a new report from consultant PwC.
There were only 137 transactions announced in the fourth quarter, down 20% from the fourth quarter of 2018. Those deals were worth $18.3 billion, down 12%.
For the year, there were 635 deals, down 27%. The volume of the deals was $91.9 billion, down 27%.
Volume was dominated by four mega deals worth $40.6 billion. A year ago there were five mega-deals. They were worth $68.1 billion.
“Despite the contraction in deal volume, 2019 was a transformative year for the sector, with game changing mega deals coming to a close and over the top (OTT) focused strategies disrupting the relationship between traditional media and Big Tech,” PwC said in its report.
“We expect the 2020 M&A market to remain consistent with 2019, as leading industry heavyweights roll-out key strategic offerings, all while evaluating their internal portfolio, looking for opportunities to monetize existing assets and repurpose capital," the report said.
Looking ahead PwC sees several trends that could shape M&A activity in 2020. Among them are the streaming wars, the 5G rollout by mobile carriers and the way the advertising business is being reshaped by data and technology.
“The 2019 M&A market softened much more than we had originally anticipated and we expect 2020 levels to be commensurate with 2019. Why? We believe the dominant market players will continue to focus on their internal strategies in order to solidify their market position in a year that will shift the consumer landscape for decades to come,” said Bart Spiegel, US Technology, Media & Telecommunications Deals Partner.
