|
By Georg Szalai
Select parts of the media and entertainment business will remain attractive investment targets despite economic and other challenges, private equity and venture capital executives said Tuesday at an Advertising Week panel. The discussion, titled "Show Me the Money," was held at the Paley Center, and concerned the role and influence of private equity and venture capital in the media business.
Bain Capital managing director Ian Loring, whose private-equity firm has stakes in media giants such as Clear Channel and The Weather Channel, said he expects to remain interested in cable networks, radio and outdoor, even though momentum on deals has nearly come to a halt over the past year amid recession, financial crisis and secular challenges to traditional media.
These factors have hurt cash flows and access to leverage, which are key to private-equity firms' returns. But some of the trends have improved, and the M&A market has shown signs of improvement. That, along with opportunities to cut costs further, are likely to bring back deals, the panelists suggested.
Amid reduced growth rates in many parts of the sector, media companies need to continue to shrink and cut costs while investing in the future, Loring said. For example, The Weather Channel has seen lower advertising revenue and costs, but has approximately doubled its programming investment to ensure viewer stability or growth, he said.
Click to read more ...
|
