The following is a perpetual-work-in-progress. Once you start to compile a list of mergers and acquisitions, you realize why it’s nearly impossible to have a complete list. We are quite confident that the following is a very good, comprehensive list of the largest, more notable deals… but it is not - and no list will be - fully complete because there are too many countries around the world and too many industries to report (it is highly possible that the Wall Street Journal or Financial Post, for example, has such a list… but it would be thick and unwieldy).
We have included:
- many industries
- have not adjusted for inflation
- mergers (be it all cash, cash/stock, or all stock)
- acquisitions (we have excluded partial acquisitions)
- private equity deals.
It is certainly not complete, send me any ones you think I am missing or industries you want us to add next to ash@mojosupreme.com or leave in the comments.
Trivia:
- In 1981, when DuPont acquired Conoco for $7.8B, it was the biggest deal of all time. But adjusted for inflation, that remains a $20B deal by 2008 standards.
- KKR’s private equity deal for KKR remains the biggest buyout when adjusted for inflation, but in actual dollars it has been long surpassed.
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WatchMojo NewsletterHenry Blodget takes on the WSJ-fanboys who say that Rupert Murdoch’s first course of action should be to take venerable Dow Jones’ flagship Wall Street Journal’s website and make it free.
For some time, I’ve had my doubts. Two weeks ago, Paid Content pointed to a report from Bear Stearns analyst Spencer Wang that challenged that conventional wisdom: arguing that WSJ would need to grow traffic by a factor of 12 to make the numbers worthwhile.
Because I thought the $6 CPM Wang used was extremely low, I thought there was a way WSJ.com could recoup $78M it currently generates in subscription revenue, if it wanted to.
Yesterday Henry Blodget added that indeed, Murdoch might do no such thing.
Truth be told, I think that given all of the ad inventory that Murdoch owns (IGN.com, MySpace.com, AmericanIdol.com, all Fox newspapers and TV stations’ websites, MarketWatch.com, Barrons.com), why would he jeopardize and cannibalize (wow, I sound like Reverend Jesse Jackson there) that lucrative $78M in subscription revenue for the potential to make it up in ad dollars. I agree with a lot of Blodget’s points… but let’s just run some numbers and see how Mr. Murdoch could make it happen:
- Just to explain some of the numbers: the main page and category index pages are very valuable, so I think they can get $50 CPM if they have 1 or 2 ad impressions.
- From my experience as a VP of Sales of a free, ad-supported mid-sized publisher, I think WSJ.com would get 10% of its ad inventory from the main page (right now, it gets 90%, probably, because search engines do not read the inside pages… but a free site where search engines drive in traffic to inside pages would make that number fall down)
- Then, a lot of traffic would funnel down to the category pages (Technology, Careers, Health, Asia etc.). From my experience, a lot of advertisers prefer this more targeted landing page, so they can maintain a high and healthy CPM.
- The “inside pages” simply refer to articles page, which will be broken down into targeted buys and run of site ad buys. Clearly, the targeted buys yield a higher CPM (basically, think an ad for Mercedes-Benz in cars as opposed to an ad for Dubai in cars…)
- All sites have some remnant, which in this case is different from run of site in the sense that it’s a network buy. I know this sounds blasphemous to the WSJ.com, and by network, we do not mean third party ad networks… but rather, the ad networks that News Corp. is planning to roll out soon.
- Let’s assume 5% goes unsold… which I think will not be the case for WSJ.com… but to make this realistic.
The sums of those rows add up to 100%… to estimate how many video streams WSJ.com can generate, I took 15% of total impressions. I’ll spare you the 1,000-word explanation as to why.
As per CPM rates for video, let’s face it, rate cards are notorious for being too high and never maintained, so if WSJ.com has a rate card of $90 CPM, then they probably sell out at $75 CPM. Quite rich.
This also excludes any search revenue, contextual text ads revenue or sponsorships… can a site like WSJ.com generate $100M in ad revenue per year? Yes. After all, its peer NYTimes.com generates $300M off 45M uniques.
If you look at my numbers, WSJ.com can somewhat seamlessly swap out the subscription revenue for advertising revenue with the same traffic. Of course, a free site would indeed jack up impression levels and reduce CPM rates a bit… but the argument for why the WSJ.com should go free has never been about mathematics alone.
Update:
- OpinionJournal.com - Sign of things to come?
- WSJ starts march towards free.
All right, first off, I am really not referring to any one in particular.
Second, I am certainly not referring to people involved in the following story: Billionaires Can’t Keep Frontline Wireless From The Deadpool, after all, the company’s backers and advisers include big names and accomplished people such as billionaires John Doerr and Ram Shriram, as well as former Netscape CEO Jim Barksdale and former FCC commissioner Reed Hundt.
But I think that as important as it is to have good advisers whom you can turn to for advice and wisdom (I am blessed to have one of the best), having the wrong advisers is a surefire way of killing your company. I am probably stating the obvious, you would think, but a lot of young entrepreneurs spend a lot of time and money trying to lure big names to their company, only to have it backfire.
There a number of reasons for this, they are:
Spend too much time focusing on the forest
Yes, it’s good to see the forest through the trees… but you also don’t want to spend too much time thinking big when you have tactical, micro-level operational issues to tend to. Friendster, for example, had an a-list backers list that was thinking of how to defend the eventual attack from Google that it lost sight of the user interaction and navigation issues that bogged down the site. In the end, MySpace - ironically with a more deficient UI - zoomed past Friendster by letting anything go.
Conflicts of Interest
I’ll occasionally talk to a VC and within minutes he’s hawking one of his portfolio companies to me. That’s fair, and par for the course… if an investor wants you to scratch one of his company’s backs, I think it’s a very reasonable request - so long as he does not force you. But for an adviser to be pledging allegiance to another company when he’s supposedly giving you advice is plain wrong.
Bad Apples, Worst Deals
I once met a would be angel investor who turned out not to be an angel, but a potential intermediary. As the conversation continued, he said he would help me if I merged my company with one of the companies in his fiefdom. It was appalling but the truth is, it was not all that odd. Allegedly, Mike Moritz of Sequoia urged Peter Thiel to merge his Confinity.com with Elon Musk’s X.com to form Paypal. Paypal struck big, with an exit of $1.5B (placing it in both the Top 13 Explosive Web Startups of All Time and the Top 10 M&A Deals of All Time) but to this day, some would suggest that Thiel and Moritz don’t exactly get along.
I am not passing judgment on the angel cum intermediary cum advisor cum M&A artist I met, maybe he sincerely thought he was doing me a favor… but the point is, if an adviser had bad intentions, you the entrepreneur are screwed.
Again, advisers can help you grow considerably. I myself serve as one to many entrepreneurs and companies and like to think that they appreciate what I have to offer and what I have done for them… but don’t fall in love with the concept and idea of having a bunch of advisers surrounding you merely for the sake of it.
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