A marriage between Advanstar and UBM would be a good fit, according to industry sources.
UBM in a statement Friday confirmed that it is in talks over a potential acquisition of Advanstar. UBM also said that the discussions “may, or may not, lead to a transaction.” The disclosure was made pursuant to a U.K. regulatory requirement when there is market speculation regarding a potential acquisition by a public company.
UBM did not disclose the transaction’s value, although news that Advanstar was on the auction block surfaced in July around the time of the company’s Project trade show in New York City. In the weeks since, it has been learned that Advanstar’s price tag is about $900 million.
According to sources, if a deal were to be consummated, it would probably happen within the next few weeks.
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UBM and Advanstar’s crown jewel, MAGIC Marketplace trade show, both operate trade shows and event services. About 59 percent of UBM’s business is organizing trade shows and “live person” events. That component of the business generates revenue by exhibitors purchasing space at the trade shows, event sponsorship and attendee entrance fees. UBM is the world’s second-largest “pure play” event organizer, with Reed Exhibitions in the top spot. UBM, which believes that the experience of face-to-face interaction between buyers and sellers continues to be an important part of some industries’ sales and marketing activities, is said to be keenly interested in Advanstar’s MAGIC.
MAGIC operates 54 trade shows, 100 conferences, 30 publications and nearly 200 electronic products and Web sites. It has 600 employees in North America and Europe.
One source said that if the two firms merge, “It would be a good thing.”
UBM also owns PR Newswire, which represents 25 percent of its business. The balance of its operations is its marketing services component, representing 16 percent of the overall business.
The company traces its history to 1918 when it was incorporated as United Newspapers Ltd. It is now the largest trade-show organizer in China, India and the ASEAN region. It has more than 5,000 employees and offices in North America, South America, Europe and Asia.