10 FLEXIBLE, VERSATILE, RESILIENT | MEDIA talk
GLOBAL MEDIA M&A CONTINUED
Sector drivers may have influenced deal values with R&D heavy sectors soaking up larger amounts of investment. Equally, there will be an incentive to follow market trends and businesses will continue to seek funds in order to adapt their businesses to emerging opportunities. The biggest deal of the first half brought together Liberty Global and Telefónica in a deal to merge their respective UK telecoms operations, O2 and Virgin Media. The deal, which values the joint venture at GBP £31.4 billion, is set to disrupt the broadband and mobile market in the UK by bringing together the second-largest broadband network with the largest mobile network. The two owners have also committed to additional investment of around GBP £10 billion over the next five years as they realise synergies by, for example, shifting Virgin Media’s mobile clients away from EE and onto O2’s mobile network. The merger will have stirred competitors, including leading rival British Telecom (BT), who will be exploring their options in response.
Canada managed to push slightly ahead of South Asia – including India and Pakistan – in terms of global deal volumes in H1 2020. As a target region, Canada lifted its share of deals by 3% in H1 2020, ending up with 5% of global deals by volume. Similarly, the country saw a 3% increase in its share of deals as an acquirer region (7%). The market has seen notable activity in publishing and TV/film production. Canada has long sought to protect its own cultural industries from being subsumed by its larger neighbour, the US, by establishing a minimum requirement for Canadian broadcasters to air Canadian-owned content. The swelling popularity of streaming services in Canada, which are not bound by the same rules, led to the creation of a panel in 2018 to assess the impact and potential regulatory changes. The initial report, which was released in January this year, may well have implications for television advertising, broadcasting and content producers in addition to OTT streaming services.
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