On sale – Informa T&M, Datamonitor, Ovum and Butler

Informa is being bought, but by whom? United Business Media, the UK publishing giant, started the bidding and then dropped out. Now private equity groups are in play, such as Providence are bidding. The primary logic for a merger with UBM was the economies of scale in combining two large business media and exhibitions groups. The bidding was great news for Informa shareholders, whose stocks rose 15% in value yesterday. We’re holding a webinar on June 26 to discuss the impact on the Datamonitor brands.

The analyst firms involved in this deal are unlikely to be a notable factor: Informa is best known for its business publishing services which include Lloyd’s List, the daily martime newspaper.

The UK deal may be difficult for those outside Europe to assess (indeed, the New York Times reported that Informa was buying UBM, rather than the other way around).

However, it’s not clear that a purchase will be good news for the premium businesses in the Informa group: Informa Telecoms and Media, Datamonitor, Butler and Ovum (which itself has aquired Orbys, RHK and Summit). Informa’s lack of interest in these businesses is astonishing, and actually not a good sign. While it might feel like a sign of confidence, Informa’s hands-off approach reflects a lack of interest, and a lack of appetite to use Informa’s resources to expand the impact of its analyst brands. In particular, Informa’s deep conference and events expertise would have helped Ovum and Datamonitor to exploit growing opportunities for their events businesses. No such exchange of expertise seems visible.

So if Informa sees few opportunities to amplify the revenues from the analyst firms, and if a buyer looks for opportunities to release cash in order to reduce borrowing to fund the purchase, then some of these firms may be divested. And that brings us back to the opening field of bidders which could even include Forrester, whose European Forum opened here in Lisbon recently. With around $270m in cash in the bank, and a recession on the horizon, Forrester may be able to get a good price for analyst firms that start to come onto the market. There may be surprises in store.