The deals are coming fast and furious.
Mergers and acquisitions in the showbiz space surged to nearly $72 billion in 2005, up 17.5% from the previous year.
It was the liveliest period since 2001, when AOL and Time Warner hooked up — a deal that closed just as the Internet bubble burst, and deal flow dried up for a few years, hitting a low of $43 billion in 2003, says a new report by PricewaterhouseCoopers.
Three Hollywood studios, MGM, DreamWorks and Pixar, have changed hands within the past year. MGM went for $5 billion.
Paramount’s purchase of DreamWorks closed early in ’06, and Walt Disney’s Pixar pact will become official later this year, meaning ’06 is on track for even bigger numbers.
Media congloms have been snapping up Internet assets. The casino, broadcasting and cable sectors are rife with deals. Cash-rich private equity firms are fueling the fire. So is the convergence, at long last, of media, entertainment, telecom and the ‘Net.
PWC tracked 252 deals in ’05. The firm defines transaction activity broadly, as M&A, spinoffs, consolidation and other forms of restructuring, like News Corp.’s taking its Fox Entertainment division private for $7.2 billion.
Other large deals in ’05 included: MGM Mirage’s $7.8 billion acquisition of Mandalay Resorts; Harrahs $6.3 billon purchase of Caesars Entertainment; Liberty Media’s $4 billion spinoff of Discovery; and Movie Gallery’s $1.2 billion buy of Hollywood Entertainment.