* Onex Partners III will make equity investment of about
* Termination fee set at $61.75 mln
* Deal expected to close in second quarter
* Nielsen shares rise 2 pct to $36.31
By Bhaswati Mukhopadhyay
May 6 Nielsen Holdings NV, best known
in the United States for its TV ratings business, said it would
sell its expositions business to Canadian private equity firm
Onex Corp for $950 million, freeing up cash for its
planned push into the radio measurement business.
Nielsen Holdings provides a host of data services, including
measuring traffic to websites and the shopping habits of
"Divesting the expositions business allows us to focus on
these core areas that provide our clients with a comprehensive
understanding of consumers," Nielsen Chief Financial Officer
Brian West said in a statement on Monday.
Nielsen shares rose as much as 2 percent on the New York
Stock Exchange on Monday.
The deal with Onex comes about five months after Nielsen
said it would buy radio ratings company Arbitron Inc for
$1.26 billion in a deal that would create a powerhouse, placing
the measurement of audience for TV and radio under one company.
"We are thrilled to be able to have this transaction bump up
so closely to Arbitron," West said on a conference call. "We
will be able to do the Arbitron deal with a lot less debt. So we
will need to raise $950 million less debt for that transaction."
Nielsen said in December that it had a financing commitment
for the total transaction amount.
"They are actually trading the expositions business for the
Arbitron business. The math is very symmetrical. They getting
just shy of a $1 billion in cash for the expositions business
and ... with Arbitron they paying just over a $1 billion in
cash," analyst Todd Juenger of Sanford C. Bernstein said.
Juenger said that instead of getting into the radio
measurement business, Nielsen should just focus on what their
customers really want -- quickly deliver a more robust internet
and television measurement program.
Nielsen's other two divisions -- the Buy and Watch
businesses -- together accounted for 97 percent of its revenue
The Buy business measures what consumers buy and analyzes
consumer behavior, while the Watch business measures viewership
data across TV, the Internet and mobile screens.
Revenue in the expositions business, which produces more
than 65 business-to-business trade shows and conferences in the
United States every year, has fallen in the last two quarters.
West said since the deal with Onex was a tax-free
transaction, there would be quite a bit of value accretion from
"There will be an EPS impact that we will disclose and
characterize as we close this later," West said. "But in terms
of the growth rate, it is not really material."
Onex Partners III, Onex's $4.7 billion private equity fund,
will make an equity investment of about $350 million, of which
Onex Corp's share is about $85 million as a limited partner in
Onex has about $15 billion of assets under management.
The deal, which includes a termination fee of $61.75
million, is expected to close in the second quarter.
Reuters reported in March that Nielsen Holdings was in the
early stages of selling its expositions business and had hired
Credit Suisse to help with the sale.
Nielsen was bought by a group of private equity firms
including Blackstone Group, Carlyle Group and KKR
& Co in 2006. The company went public in 2011.
Fried Frank acted as legal adviser to Onex.
Onex shares rose 1 percent to C$50.00 on the Toronto Stock
Exchange on Monday.