Nielsen Clears Regulatory Hurdle for Arbitron Merger

Global information and measurement company Nielsen Holdings (NYSE: NLSN  ) announced on Friday that it has reached an agreement with the FTC regarding its acquisition of rival researcher Arbitron (UNKNOWN: ARB.DL  ) . With that hurdle cleared, and pending completion of customary closing conditions, Nielsen expected the deal to close on Sept. 30.

Nielsen announced last Dec. 17 that it wanted to buy Arbitron for $48 a share, or $1.3 billion, cash, plus some minor debt financing. It expects the merger will add $0.26 to adjusted net income per share in the first full year of operations, and $0.32 of accretion to adjusted net income per share after the second year, reflecting an incremental $0.06 in the second year.

Saying the company was glad to have the regulatory approval process behind it and that the agreement reached with the agency is "highly acceptable," Nielsen CEO David Calhoun said, "We are looking forward to providing all of the benefits of the combined company to our new clients in the radio industry and their advertisers, driving incremental value for them as well as our shareholders."

The consent decree issued by the FTC says the agreement Arbitron had reached with ESPN and comScore (NASDAQ: SCOR  ) last September to measure TV, radio, PC, mobile, and tablet engagement can remain in place, but if a third-party vendor comes along and agrees to a licensing deal, Nielsen would give them access to Arbitron PPM and related data, as well as software and technology currently being used in the ESPN project solely to measure the cross-platform data. This agreement will remain in place for eight years. 

Nielsen believes adding Arbitron to its stable will allow it to more broadly measure what consumers are watching and listening to around the world, as well as to delve deeper into the preferences of multicultural audiences in the United States.

The combined company will expand advertising effectiveness for radio clients and be better able to solve for unmeasured areas of media consumption, such as streaming audio and out-of-home. Because cross-platform measurement is still in its infancy, Nielsen will now have the opportunity to put its stamp on what the outcome will be.


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