Sector M&A advisor Results International said PR was the third most active sub sector for marcoms M&A in the quarter, behind full-service digital and website UX.
Deals included: US firm Finn Partners acquiring travel and tourism agency The Brighter Group; The BMF Media Group acquiring LFB Media, a lifestyle and hospitality PR company; and Vested, the US financial communications specialist, buying UK-based Templars Communications.
As well as the continuing buyer interest in specialist and niche PR agencies, the past few months saw several PR businesses looking to expand their skill sets by buying in non-PR marcoms expertise, Results International said. For example, Next Fifteen acquired digital marketing communications agency Brandwidth in Q1.
James Kesner, director at Results International, said: "Deal volumes for PR agencies remain very healthy, with Q1 seeing the second highest quarterly deal volume for the past 12 months. Both trade buyers and those outside marcoms value the c-suite access and breadth of creative skills that PR provides.
"It’s also unsurprising that we’re seeing a lot of interest in specialist agencies, as they offer a level of expertise in their chosen area that’s practically impossible for more generalist agencies to match. That makes them prime targets for acquisition. Also, it’s not just marcoms groups and consultancies acquiring PR expertise any more; PR players continue to fight back and buy into the full-service digital space."
He added: "The merger of Burston-Marseller and Cohn & Wolfe was also big news in Q1, but that was more reflective of WPP’s continuing inward focus and rationalisation – a process that’s only likely to intensify, following the departure of Sir Martin Sorrell.
"When it comes to acquisition, we’re seeing growing interest from private equity buyers who value the retainer-based revenue model and strong human capital held in these businesses. With almost a third of deals being cross-border, the market is still thriving and is well set for the rest of 2018."