MIL OSI – Source: Axel Springer in English –
Headline: Axel Springer acquires US-based eMarketer
Axel Springer further expands in US market / Transaction strengthens paid models / eMarketer complements Axel Springer’s business media
Axel Springer SE acquires 93 percent of the shares in eMarketer Inc., a leading provider of high-quality analyses, reports, and digital market data for companies and institutions, based in New York City. The transaction is another milestone in the strategy to expand digital activities into the English-speaking world – especially in the US market – and to broaden the portfolio of innovative paid content offerings. Also, the acquisition of eMarketer strengthens Axel Springer’s position in business-related news and content.
eMarketer is the go-to source for excellently researched, authoritative business information in the fields of digital marketing, sales, and trends. The company’s reports, databases, statistics, infographics, and forecasts have become standard tools in numerous industries and are cited more than 65,000 times per year by leading international media, according to own sources. More than 1,000 firms are holding subscription contracts with eMarketer, among them most Fortune 500 companies. Around 81 percent of eMarketer’s revenues come from these subscription services. The remainder comes from the company’s website, which has extensive openly accessible information, and from its newsletters, which are read by hundreds of thousands of marketing professionals.
Mathias Döpfner, Chief Executive Officer of Axel Springer SE: “As more and more industries are facing the challenge of digitization, the smart creation, processing, and presentation of relevant market information is becoming increasingly important. eMarketer is a long-established, successful, and profitable publisher of high-quality digital market data and is excellently positioned to benefit from these market developments. The acquisition of eMarketer follows our strategy of expanding our US activities and strengthening our paid models. At the same time, eMarketer perfectly complements our business services BI Intelligence and POLITICO Pro in Europe, from which we know the attractiveness of strong subscription-based businesses. The convincing growth and margin prospects for eMarketer make this transaction another element in Axel Springer’s successful digital transformation.”
Terry Chabrowe, co-founder and CEO eMarketer: “We’re excited to become part of the Axel Springer family. Their commitment to digital and strategic vision makes them the ideal partners for the next stage of eMarketer’s growth. Just as important, the cultural fit between our two organizations is the kind we dreamed of when we began looking for the right home for our business.”
The transaction is based on a company valuation of eMarketer of approximately USD 250 million (approximately EUR 220 million). Taking into account the company’s cash and debt, Axel Springer pays approximately USD 242 million (approximately EUR 213 million) for 93 percent of the shares. Together, eMarketer’s co-founders Terry Chabrowe, Chief Executive Officer, and Geoff Ramsey, Chief Innovation Officer, will continue to hold around seven percent of the company. Both co-founders are long-term committed and will keep their positions.
In 2015, eMarketer Inc. achieved revenues of USD 45.5 million (approximately EUR 40.0 million) and an EBITDA of USD 13.5 million (approximately EUR 11.9 million). For 2016, eMarketer expects revenues of around USD 53 million (approximately EUR 47 million) and an EBITDA of around USD 18.5 million (approximately EUR 16.3 million), i.e. an EBITDA margin of around 35 percent. The company was founded in 1996 and currently employs more than 180 people. For its reports, databases, and forecasts, it operates comprehensive research efforts, supplemented with the aggregation of third-party data. Its business intelligence products have become a much-valued basis for strategic business decisions in many companies, most notably in the advertising industry. In addition to its New York City headquarters, eMarketer is also operating a London office for serving the European market.
Axel Springer will finance this acquisition using existing credit lines. The transaction is subject to approval by relevant antitrust authorities.
About Axel Springer
Axel Springer is one of the world’s largest digital publishers in terms of reach. Taking into account all digital platforms, the company attained 200 million unique users worldwide as a monthly average in Q1/2016. With headquarters in Berlin, Axel Springer SE is divided into three operating segments: Classified Ad Models, Paid Models, and Marketing Models. The company is active in more than 40 countries with subsidiaries, joint ventures, and licenses.
Over the last several years, the company has gradually built up a broad portfolio of US investments. Axel Springer owns majority stakes in Business Insider and the mobile shopping platform Retale and is invested in, for example, the accommodations community Airbnb, the virtual-reality startup Jaunt, the news platform Mic.com, the social video news company NowThis Media, and the lifestyle portal Thrillist.com.
Axel Springer’s business media include such general-interest brands as BUSINESS INSIDER, WELT and BILANZ in Germany, and Swiss HANDELSZEITUNG, special-interest offerings like finanzen.net, BI Intelligence, and POLITICO Pro in Europe, and now also eMarketer as a specialized B2B service.
In 2015, Axel Springer SE achieved an EBITDA of EUR 559 million. 62 percent of Group revenues were generated by digital activities, which amounted to 70 percent of Group EBITDA. The company employs around 15,000 people worldwide.