THIRD QUARTER M&A ACTIVITY DECREASES "DRAMATICALLY," WHITESTONE SAYS.

Whitestone Communications (New York), which tracks M&A activity for its annual Who's Buying Whom reference, reports that both the number and dollar value of mergers and acquisitions in the publishing, information and training fields declined "dramatically" in the third quarter of 2001 when compared to the same period last year. The total number of acquisitions dropped 40% to 95 from 159 last year while the dollar value of those deals declined 60% to $4.4 billion from the $11 billion recorded last year.

Whitestone reported that the number of investments for the quarter declined 46% to 30 from 56 last year and the dollar value of those investments dropped 70% to $299 million compared to $999 million last year. Two major European deals, Cinven's purchase of Vivendi's business and health publications for $1.8 billion and VNU's sale of its consumer magazines to Sanoma WSOY for $1.1 billion, were not included in the statitstics.

Noting that both the recession and the events of 9/11 have made both buyers and sellers more reluctant to complete deals, Whitestone president Baran Rosen said "as companies' earnings come under pressure, they are less likely to put themselves up for sale. Buyers, on the other hand, are less certain of an acquisition's ability to perform and will not want to pay as much for the deal or will not want to do the deal at all." The sooner the country's situation stabilizes, Rosen added, "the sooner we are back at the deal table."