Some consolidation in the world of market analysis. Kantar, the research division of advertising giant WPP, has entered into a global alliance with comScore, the company that measures traffic and other audience metrics of online and mobile properties. As part of the deal, WPP will buy up to 15.45% of comScore shares at a price of $46.13/share, giving it a 15%-20% stake of the company, and comScore is buying Kantar’s audience measurement business covering some markets in Europe. The deal is expected to be completed later this year; full details of the transaction are below.
According to Google Finance, there are currently 34.20 million shares of comScore. Working out the math, WPP is paying around $243 million for a stake in comScore.
The news comes also as comScore has announced its quarterly results: $90.1 million in revenues were up by 19% on a year ago, but also a GAAP net loss of $2.7 million, or $0.08 per basic and diluted share. That beat analysts’ estimates on both counts.
The Kantar division of WPP is known for its rolling research tracking smartphone sales in key markets (which we have covered); less so for its audience tracking, which is a market where comScore is regularly quoted — although many have disputed comScore’s accuracy.
The deal will see comScore partnering with Kantar and its operating businesses on cross-media audience and campaign measurement in non-U.S. markets, while comScore will also buy the assets of Kantar’s Internet audience measurement businesses in certain European markets. “In these markets, Kantar and comScore will continue to provide the same level of seamless integration and data services,” comScore said in a statement.
The other reason for the deal is to expand the digital data that WPP collects and uses for its larger business in advertising, marketing and other areas. “These agreements continue WPP’s strategy of developing its services in important markets and sectors and strengthening its capabilities in digital and data investment management businesses,” WPP noted in a statement. WPP’s digital revenues (including associates) exceeded $6 billion in 2013, or 35% of the Group’s total revenues of $17.3 billion. The company has a longstanding target for digital to account for 40-45% of its revenue by 2020.
“This long-term, strategic alliance will simplify the deployment of global measurement capabilities and accelerate the creation of new services for the industry. The emerging mediascape points to a massive global opportunity waiting to be unlocked by cracking the code on cross-media audience and campaign measurement,” said comScore CEO Serge Matta, in a statement. “We look forward to working together with Kantar to deliver new measurement products based on our complementary offerings in these markets.”
Kantar CEO Eric Salama commented, “By partnering with comScore and combining our respective strengths, we will integrate data and expertise to give our clients a new standard in measuring audiences and campaigns across multiple platforms. This continues our strategy of combining survey, panel and census data and putting digital at the heart of all we do.”
As WPP notes it, the deal will give it “a significant equity stake in comScore. WPP will offer to purchase up to 15.45% of comScore through a tender offer with an offering price of US$46.13 per share, and comScore will issue new shares representing 4.45% of comScore in consideration for certain Kantar European internet audience measurement assets, plus potentially additional new shares, depending on the result of the tender offer. Through a combination of new shares primary issuance by comScore and the tender offer, WPP will own a total stake in comScore of between 15 and 19.9%.” It adds that the deal is subject to regulatory approvals.
More to come.