Comms sector set to attract PE interest in 2010

The UK private equity sector is set to enter 2010 with a renewed interest in the communications and media market, according to a survey from accountants and advisers, Grant Thornton.
A quarterly survey of more than 100 private equity executives in the Private Equity Barometer, revealed that 15% of private equity firms ranked media and communications among the top three sectors they planned being the most active in over the next 12 months.
The sentiment was quite different over the last 12 months, where the executives surveyed confirmed that the media and communications sector featured the least area of activity.
“As the least popular sector in the survey over the previous 12 months, it is encouraging to see that a growing number of private equity executives are turning to media & communications companies as a viable option for backing,” said Grant Thornton head of media and entertainment, Mark Henshaw.
While all sectors are expected to experience a decrease in price earnings (P/E) ratios next year, media & communications was ranked fourth with a P/E ratio of 6.38. It comes in behind healthcare (7.33) technology (6.86), and financial services (6.43).
Henshaw added that there was confidence that media and communications businesses were beginning to bounce-back from the market downturn, particularly in the fragmented digital marketing sector.