A spin-meister’s $841 million deal shows the public relations industry is taking a cue from some of its more demanding clients. The purchase of press release service PR Newswire is the latest in a string of deals for Cision, a private equity backed owner of the Gorkana journalist database and a clutch of other products that help communications professionals “reach out.”
Chicago-based Cision started rolling up PR software in 2014, after it was taken private by LBO firm GTCR. It soon merged the group with Vocus, another GTCR-backed PR technology holding, London-based Gorkana and two small social media outfits, under the leadership of Cision CEO Peter Granat. Buying UBM’s PR Newswire is a logical next step for the company, which bills itself as a technology hub for the industry.
Such acquisition “platforms” have already colonized the pharmaceutical and consumer sectors. Valeant’s debt-fuelled deal spree turned a formerly sleepy Canadian drugmaker into an $80 billion behemoth before questions about accounting practices and the firm’s relationship with a big customer crashed the shares this year. Over in the food sector, Brazilian billionaire-backed 3G Capital has been gobbling up companies from Burger King to Kraft and Heinz. Cheap debt and a fragmented industry ripe for technological disruption meant it was only a matter of time before the flaks piled on.