Nielsen is being acquired for $16 billion, including debt, just a week after rejecting a lesser bid earlier this month.
Nielsen viewing data plays a significant part in determining where billions of dollars in advertising dollars are spent each year. The corporation generates approximately $3.5 billion in global revenue each year.
Evergreen Coast Capital Corp., an affiliate of Elliott Investment Management LP, and Brookfield Business Partners LP, along with institutional partners, will pay $28 each outstanding Nielsen share.
Brookfield Business Partners will invest $2.65 billion in preferred equity, which will be convertible into 45 percent of Nielsen’s common equity. The equity portion of the transaction is valued little more than $10 billion in cash, with Nielsen holding the remaining in debt.
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Brookfield said on Tuesday that it expects to invest around $600 million, with the remainder backed by institutional partners.
Nielsen Holdings Plc, based in New York City, rejected the group’s earlier bid, claiming it significantly undervalued the company. That offer was approximately $25.40 per share, or about $9 billion before debt was assumed. Nielsen’s stock rose 22 percent at the opening bell when it accepted the increased offer. The stock closed regular trading at $26.72 per share, up 20.3 percent.
Nielsen has been chastised for failing to develop new techniques of measuring the amount of time individuals spend viewing streaming services like Netflix or Hulu. Loading content onto phones, tablets, and other smart devices has become a lot more involved operation.
Nielsen is seeking to address these concerns by launching a new cross-media measurement tool before the end of the year. According to the company, Nielsen One can provide more comparable and complete information across platforms ranging from traditional televisions to a slew of other digital and streaming services.
Nielsen’s board of directors unanimously approved the improved offer, and the business will go private if the transaction is completed.
There is a 45-day go-shop period during which Nielsen can consider and accept alternative bids, but breaching the agreement with the private equity consortium would result in a $102 million termination charge.
The transaction is scheduled to be completed in the second part of this year. Nielsen shareholders and authorities must yet approve it.