Home > PR > Meltwater acquired as private equity tightens grip on PR software market [PR tech sum no. 47]

Meltwater acquired as private equity tightens grip on PR software market [PR tech sum no. 47]

The largest PR and comms tech companies, along with many startups, are now controlled by PE firms; is this good for the PR community?

A private fund recently closed its acquisition of Meltwater (see first story below). This adds to a growing collection of private equity firms (PE) that have taken an ownership stake in software companies that provide tools to PR and communications professionals.

Some of those include the following:

  • Cision, arguably the largest vendor in the space, is owned by Platinum Equity – the second private equity firm to take over the company. Along the way, Cision has acquired dozens of other vendors in the space and controls two of the five biggest press release distribution services in PR Newswire and PRWeb.
  • Apollo Global Management, a publicly traded private equity firm (NYSE: APO) owns Notified (formerly Intrado and West). Many PR people aren’t familiar with Notified, but it is a significant business cast from brands you used to know. For example, West acquired PR tech assets from NASDAQ including Globe Newswire and the remnants of MarketWire. It also acquired an interesting little startup called Notified before the business unit took on the namesake.

The list above hints at the typical PE playbook: buy two or more companies that seem to have complementary capabilities, merge them together, cross-sell and upsell customers – then sell the company a few years later at a premium.

It’s a great idea on paper but in my view, it hasn’t worked well in comms. Why?

  • The cross-sell and upsell of new tools is harder than most expect. Agencies are cheap and don’t want to spend on tools that cut into margins. Corp comm departments are chronically underfunded and lower on the corporate priorities list. You need an absolutely crystal-clear pain point to get funding for such a project.
  • Executing M&A post-deal is hard. Merging two (or more) companies is very challenging. The operations, the technology and the cultures are rarely compatible. You always run into unforeseen problems.
  • Integration overshadows innovation. The companies get overwhelmed integrating existing tools – which means innovation all but stops.
  • PE lacks PR savvy. PE firms, in contrast to VC counterparts, tend to be reclusive and averse to exposure. This means they don’t use PR and comms and therefore don’t really understand the market.

Is all this PE activity in PR tech good for the PR community? I’m not optimistic, but time will certainly tell. PE funds can only wait for so long before selling the whole – or slicing it up and selling it off in parts.

And now onward with this month’s PR tech sum.

1. Meltwater acquired by private fund

MW Investment B.V., a private fund jointly controlled by two private equity firms, closed its acquisition of Meltwater.

According to the announcement:

“The offer and subsequent post-closing restructuring were originally announced on January 18, 2023, and completed on August 9, 2023. Meltwater shareholders were entitled to receive NOK 18.00 settled in cash, shares in the Offeror, or a combination thereof. As a result of the transaction, Meltwater has been delisted from trading on the Oslo Stock Exchange.”

Meltwater has experienced a whirlwind of change in the last few years. In early 2020, the company’s founder and CEO – Jorn Lyseggen – stepped aside. At the tail end of that same year, the company quietly went IPO raising $400 million.

A year later, it went on a $100 million buying spree. Then in September 2022, Meltwater announced a “review of strategic alternatives” which I noted, is often a call for potential suitors.

The initial acquisition announcement in January of 2023 touted a 36% premium on the current trading price. At that time, 1 Norwegian Krone equaled about 10 cents USD. When I last checked there were 313 million shares outstanding which puts the final deal value – my back-of-the-napkin-math – at around $294 million in US denomination.

2. Cision shakes up C-suite again

Cision has swapped out its leadership again. It named six new C-suite leaders in August including:

  • Amanda Schmidt, Chief People Officer
  • Michael Amsinck, Chief Product Officer
  • Carrie Parker, Chief Marketing Officer
  • Nabilah Irshad, Chief Legal Officer
  • Andy Bhojwani, Chief Information Officer
  • Pehr Luedtke, Senior Vice President of Global Content

The change in leadership follows the appointment of Cali Tran as the new CEO earlier in 2023. By my count, he’s the fourth chief executive Cision has had in three years.

Cision has been shaped by a dizzying array of nearly 20 acquisitions over the last nine years. It’s gone from publicly traded – to privately held – twice in the same period. Leadership shuffles and company restructuring often followed soon after these transactions.

This latest shake-up also appears to be another restructuring. As the press release notes, “This move involves integrating the leadership and functional teams across Cision, Brandwatch, and PR Newswire” as “part of its strategic plan to deliver a more robust, end-to-end customer experience.”

“Integrating our leadership and functional teams will help create a more connected and agile company, well positioned to meet the evolving needs of our customers now and in the future,” said Tran in the announcement.

In my view, there have been too many false starts and stutter steps at the company to take a chance on mere promises. I recommend PR pros consider some of the independent and newer companies. Here’s a fairly comprehensive list of PR and comms tech vendors.

3. PR tech mentions

  • Press release grader. Shama Hyder has launched a press release grader called Snooze or News. The grader is built on ChatGPT and Hyder says her company trained the system as to what makes a good release (or not). It’s open to anyone and free to use.

Have an interesting announcement from a PR technology vendor?

Here’s the updated list of PR technology companies I’m watching and here’s how to get on my radar.

Do you need help with B2B tech marketing and PR?

Hire a B2B marketing and PR consultant who can think strategically and execute effectively. Contact me at frank-at-swordandthescript-dot-com for an introductory call.  Here are some useful links: about | services

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