B2B Exhibitions, a sector attracting more than just delegates
The B2B information industry is a highly attractive sector, with businesses delivering relevant and vital information and data to their clients. This information can take many different forms, including print publications, online digital platforms and face-to-face events; both conferences and exhibitions. In recent years there has been a constant global demand for B2B exhibitions providers from both strategic purchasers and financial sponsors, leading to numerous transactions in this market.
What makes B2B exhibitions so attractive?
There are a number of key factors that attract acquirers to the B2B exhibitions industry:
- Niche, specialist market focus: Exhibitions that focus on a particular industry, sector or specialism provide attendees with access to information that they require for their day-to-day roles. In addition, as well relevant insights into current market trends, exhibitions provide face-to-face access to industry specialists and suppliers, creating networking opportunities;
- Leading position in defined vertical: To ensure that exhibitions attract both exhibitors and the relevant target audiences, it needs to establish a reputation for being a must-attend event for that sector. For many exhibitions, this reputation is developed over several years and by delivering consistent exhibitions that meet expectations of both exhibitors and attendees;
- Content is king: To attract its target audience, exhibitions providers need to ensure that there is relevant content on offer to persuade attendees to visit. Relevant content can take the form of presentations, workshops, one-on-one sessions with experts, as well as access to a wide array of relevant suppliers and industry experts;
- Innovation of offering: For attendees that visit exhibitions, a key requirement is that they are able to access information from the show that they require. Exhibition providers are constantly innovating to ensure that navigation of vast exhibition halls and thousands of exhibitors is efficient. Recent innovations have included the use of mobile apps to direct attendees to relevant stands, as well as beacon technology;
- Recurring revenue: Established exhibitions will continue to attract exhibitors each year with many of these regularly rebooking in advance to attend the next event. For exhibitions that are in high demand, organisers are able to charge higher prices, generating increased yield; and
- Marketing opportunities: Exhibitions provide an opportunity for suppliers to access new potential clients and sell products and services directly to their target market. The exhibitions provide additional opportunities to market their offering and raise brand awareness to a relevant audience, potentially delivering strong ROI.
- M&A Trends
The acquisition of B2B exhibitions is predominantly dominated by global providers of B2B information and exhibition-focused companies. Strategic purchasers are better placed to acquire individual, specialist exhibitions and providers which help to broaden existing portfolios , these acquirers can scale acquired exhibitions and extract operational synergies that can drive profitability.
Key acquirers of B2B exhibition assets and selected transactions include:
- Informa, the UK-listed provider of information for the academic, professional and business communities, acquired Penton Media for a consideration of USD1.6bn comprising of cash (USD1.5bn) and equity (USD100m) , the transaction valued Penton Media at 11.1x EV/EBITDA. Penton Media provides a portfolio of B2B communication and information products including exhibitions;
- Reed Exhibitions, a subsidiary of the global information solutions provider RELX Group plc, has acquired a number of assets including the Fitness Show (May-17) and Jewelers International Showcase (May-15) , the value of both deals was undisclosed;
- ITE is a UK-listed organiser of international trade exhibitions and conferences and has been very active in pursuing acquisition opportunities. It has made several acquisitions including GPP Energy Advisors Limited (operator of Africa Oil Week exhibition) and a minority stake in ABEC Exhibitions and Conferences (an India-based exhibitions company);
- Tarsus is an Ireland headquartered media group operating a portfolio of exhibitions, conferences, print and online media. It has undertaken several recent acquisitions including a majority stake in Connect Meetings, a provider of trade shows to the business travel and meetings sectors (consideration of up to USD57m), and PNO Exhibition Investment (Dubai), a UK-based exhibitions provider; and
- UBM, the UK-listed business information services company acquired Allworld Exhibitions in December 2016, for a cash consideration of USD485m (implied EV/EBITDA: 12.9x). The target is an alliance of event organisers dedicated to the organising of trade exhibitions and related services.
Private equity investors tend to acquire platform assets in this market and focus on a buy-and-build strategy. Key recent private equity acquisitions include:
- Clarion Events was acquired by Providence Equity in 2015 for a total consideration of ££210m. The private equity firm has since supported the company to acquire a number of bolt-on exhibition assets including Urban Expositions (Sept-15) and Imago Techmedia (Sept-15); and
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Charterhouse Capital Partners acquired a 50% stake in Comexposium, a France-based event organiser. The estimated valuation of the company was EUR550m, implying an EV/EBITDA multiple of 13.8x. Since the transaction, Comexposium has acquired the digital marketing division of dmg events and Salon International de l'alimentation, a France-based company that manages food exhibitions.
B2C adoption of the B2B exhibitions model
Last week Future announced its acquisition of the Home Interest division from Centaur Media, which provides a portfolio of exhibitions and print and digital media focused on homebuilding and renovation. The acquisition was received positively by the market, driving an increase of c.12% in Future's share price (at the time of announcement). Whilst Future and the Home Interest Division are primarily focused on the B2C market, the Home Interest exhibitions have historically been managed using a B2B model. The business differs from traditional B2C exhibitions by its ability to attract recurring revenues from exhibitors, rather than focusing on public ticket sales. The seven exhibitions provided by the business have become increasingly important events for its exhibitors, who rely on the events to showcase products and access new potential customers. They enable these suppliers to generate significant leads and sales, driving awareness and revenues for their brands. Within the homebuilding and renovating industry, the Home Interest division has established a leading market position, making them must-attend events.
Future's acquisition of the Home Interest division not only provides it with an additional sector vertical to enhance its existing portfolio, but also adds a portfolio of strong, stable exhibitions that provide strong recurring revenues for the business into the future - it is an attractive business model that Future can leverage across its portfolio.
25/07/2017, Update following the announcement of Blackstone's acquisition of Clarion Events
Clarion Events, a leading global events organiser, was acquired by Blackstone in a transaction estimated to be worth £600m. This transaction represents another management buy-out of the company, having previously received investment from Providence Equity Partners, Veronis Suhler Stevenson and Hg Capital. The asset is rumoured to have attracted interest from several private equity investors, with Blackstone emerging as the leader in a highly competitive auction process. Blackstone has a strong track record of investing in media assets and buy-and-build platforms, and will support management to continue growing the company both organically and through selected acquisitions. Providence Equity Partners, the previous investors in the company, have secured an option to reinvest a portion of its proceeds from the sale.
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