Webinar recording: The economic outlook – implications for media M&A in 2025

Our most recent ‘selling your business’ webinar concentrated on the current economic conditions and what the media and marketing services M&A market might experience in the next 12 months as a result. Our speakers had plenty to discuss regarding the improving economy, expected lower interest rates, the much-discussed Budget (taking place on 30 October), and the impact this could have on M&A from a commercial and tax perspective.

We are delighted to share our key takeaways from our guest speakers Balduin Bippus, European Economist at Barclays Investment Bank, Frazer Barrs, Head of Media at Barclays Corporate Banking, Emily Hickley, Investment Director at Horizon Capital LLP, and Paul Winterflood and Mel Reed of Moore Kingston Smith.

The economic outlook and implications for media M&A in 2025 discussion

The current economic impact on the media M&A market

• The UK rebounded in the first half 2024 out of the 2023 technical recession, but domestic demand has been softer than headline growth rates would suggest. This has resulted in tougher trading conditions for the media and marketing services sector.
• Interest rates have started to fall and are forecast to bottom out at 3.75% in Aug 25. This will likely have a positive impact on the M&A market.
• The media M&A market is tougher than in previous years due to the macro-economic backdrop, but despite this there has till been a healthy level of transaction completions.
• Acquirer appetite remains strong amid a fragmented pool, particularly for sought after capabilities such as social, data and analytics.
• The budget on 30 October could have an impact on the market depending on what changes to taxation are announced. Click here to sign up to our webinar on 5 November: “Budget 2024 – How does it affect you and what does it mean for the media sector?”.

What businesses who are looking to grow or sell in the future need to do

• For businesses looking to borrow, make sure you are engaged with your bankers, they understand the business and you are with the right partner who has the appetite to lend into your sector. While any future acquirer might have their own funding lined up, it can be powerful to demonstrate that you have a bank in place who are prepared to lend against your business; and this of course will also come in handy in pursuing your own acquisition strategy.
• Good quality management information is crucial. Make sure that all your internal reporting is in a format and of a standard that a lender or acquirer could work with (as well as being produced punctually). These requirements are not onerous or anything outside the norms of what a professional finance team should be able to produce but will save additional costs and stress at a later point when you need to be able to share these with those working on a transaction.
• It’s vital to incentivise the second-tier management team ahead a transaction. Don’t underestimate how much potential buyers will value and expect a strong and incentivised management team staying with the business post-transaction. Sellers should start thinking about this two or three years in advance of a possible exit. Ensure you incentivise your management team in a tax-efficient way through various tax advantaged arrangements, such as EMI share options.

More information and guidance

Please get in contact if you would like to discuss this media M&A in 2025 webinar in more detail, or if you have ay corporate finance-related questions.

Click below to hear our panellists take on key points discussed in the webinar:

0:00 – Introduction
4:10 – European economic outlook update
14:15 – M&A market update
23:18 – Panel introduction
24:38 – How are clients finding the current economic climate?
31:05 – When will client spending increase?
39:00 – What could happen in the upcoming Budget, and how could this impact the M&A market?
45:50 – Considerations when preparing to exit a business
47:04 – Factors that could impact the economy over the next 12 months
48:33 – Views on the outlook for the years ahead and what media businesses should be considering