Are You Entertained?
It’s no surprise there is plenty of deal activity in the entertainment space, with corporations seeking to expand market share through consolidation or acquire new product lines.
Free time can be hard to come by these days, which is why people prize it so highly. Especially online, everyone is competing for attention and dollars. Resorts, gaming companies, luxury restaurants, film studios and others are all trying to snag consumers’ leisure time, which has become a valuable commodity. Our attention is also pretty difficult to command—especially nowadays, since we have so many options. Younger consumers want increasingly experiential entertainment offerings, whether it’s 21+ movie theaters that serve them in their seats or resorts that offer local delicacies.
Consequently, it’s no surprise there is plenty of deal activity in the entertainment space, with corporations seeking to expand market share through consolidation or acquire new product lines. Through the end of May, this year has seen $27.9 billion in total entertainment M&A value across 252 closed transactions. That dollar sum is already 75 percent of 2014’s $37 billion total, the high of the past six and a half years. Although the pace of dealmaking has slowed slightly overall, with the 2014’s 642 transactions and 2015’s 622 unlikely to be matched this year, it remains clear that strategic buyers are still looking to entertainment deals as a means of growth. Even if overall deal flow in the sector slows in line with declining M&A activity across all industries in the wake of a few particularly active years, 2016 has already been quite robust.
