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The TV and video measurement giant Nielsen has rejected an acquisition offer from consortium of private equity firms, including the activist firm Elliott Management, in a deal that would have valued the company at about $14 billion, including its hefty $5 billion debt load.
In a statement Sunday, the company said that the offer, which was for $25.50 per share, “significantly undervalues the Company and does not adequately compensate shareholders for Nielsen’s growth prospects.”
The company also said that one of its largest shareholders, The WindAcre Partnership LLC, had held talks to join the consortium of firms looking to acquire Nielsen, but ultimately decided “that it would oppose the transaction as it views Nielsen’s intrinsic value to be significantly higher than values proposed by the Consortium.” WindAcre subsequently informed Nielsen that if it accepted the takeover offer, it would acquire enough ownership to block the transaction.
Nielsen added that it would be moving forward with a “previously approved $1 billion share repurchase authorization.”
“We continue to have strong confidence in the management team and Nielsen’s strategy to create long-term value for shareholders,” said James A. Attwood, chairperson of Nielsen’s board, in a statement. “We are always open to exploring any avenue to create value for shareholders, but the Board is in agreement with WindAcre, one of our largest shareholders, that the Consortium’s proposal significantly undervalues the Company. Further reflecting our confidence in the Company, we plan to commence share repurchases, which we expect to be an important element of our ongoing balanced capital allocation strategy.”
Nielsen had been the gold standard of TV measurement for decades, with its TV panel ratings long serving as the “currency” for TV advertising, the metric that advertisers, media buyers and networks agree represents viewership of a given TV show.
However, the rise of streaming and mobile video has challenged the company, with its clients calling it out for its slow response to streaming. The company has been trying to speed up its integration of streaming data into media planning products, but in that time a number of major TV companies have inked partnerships with other data providers to try and develop an alternative currency.
Nielsen admitted last year that it undercounted out-of-home viewers and had other measurement problems during the COVID-19 pandemic, and has been trying to work through them. The Video Advertising Bureau, a trade group that represents the major TV networks, has asked Nielsen to delay adding some of its new measurement data, arguing that it has inconsistencies.
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