Mood Media Announces it Will Acquire Muzak for $345 Million
by Deepak Sharma on Friday, March 25, 2011
Mood Media Corp., a global, leading in-store media specialist that uses a mix of music, visual and scent media to help its clients communicate with consumers with a view to driving incremental sales at the point-of-purchase is acquiring Muzak Holdings LLC, best known for providing piped music in elevators, for $305 million in cash.
With the acquisition of Muzak, Mood Media extends its global footprint, creating the largest in-store media provider globally, nearly five times the size of its next largest competitor. It will service a staggering 470,000 commercial locations in over 39 countries after this acquisition is completed.
Founded in 2004, Mood has a market capitalization of about $380 million. It has a large presence in Europe, where it provides background music and digital signage services to around 117,000 locations, from Nike to Hermes stores.
Muzak provides background music to about 300,000 U.S. locations, such as restaurants, malls and hotels. It makes most of its money through multi-year contracts and reported 2010 revenue of $195 million. The company traces its roots back to the 1930s when it distributed recorded music to theaters and stores. Today, it also provides on-hold messaging and video programming, although piped music is its forte.
Mood hopes to use Muzak's U.S. footprint to introduce more digital services, such as screens that allow customers to check merchandise in stores, Mr. Abony said.