Nielsen jolted by buyout rumors

A consortium of private investors, including activist investor Elliott Management, is in advanced talks to buy Nielsen for about $15 billion, sources confirmed to Axios' Dan Primack. The Wall Street Journal first reported.

Why it matters: Nielsen is experiencing extraordinary pressure to modernize its media measurement capabilities as dozens of new firms launch to take its market share. While its financials are stronger since dumping its retail arm, investors are wary it can compete without a strategic overhaul.

• Nielsen shares exploded on this news, closing trading yesterday up 30% at nearly $23 a share.

Be smart: This is primarily about helping Nielsen continue its transition from linear to digital media measurement without the hot spotlight of the private markets.

• Elliott has been involved with Nielsen for about four years, during which time there's been a CEO change, board changes, share repurchases and a strategic spinoff — none of which moved the stock nearly as much as the WSJ's report of a possible sale.
• Word is that Elliott has been working on this deal for some time, and has most of the $10 billion-plus of financing lined up.
• "As a matter of company policy, Nielsen does not comment on market rumors or speculation," Nielsen said in a statement. Elliott also declined comment.

Catch up quick: Nielsen Holdings sold its retail measurement arm, Nielsen Global Connect, to private equity giant Advent International for $2.7 billion last year.

• Nielsen was planning to spin off its retail business into an independent, public company after pressure from Elliott to focus on media measurement and alleviate debt. The sale to Advent replaced that effort.

Between the lines: Nielsen has come under fire over the past year for multiple measurement errors.

• In December, Nielsen admitted it had been undercounting its out-of-home audience over the prior 16 months. While Nielsen said the undercounts had "no impact or minimal impact," the Video Advertising Bureau — a vocal critic of Nielsen — argued it cost TV networks as much as $700 million in lost ad time.
• The Media Rating Council found Nielsen had been undercounting the key demographic of adults aged 18-49 in February of 2021. The MRC eventually suspended Nielsen's accreditation.

The big picture: Elliott Management has a strong track record for getting what it wants from companies it pressures.

• AT&T agreed to major changes, and eventually the spinoffs of all of its media properties, following activist pressure from Elliott.
• Twitter CEO Jack Dorsey stepped down earlier this year following criticism from Elliott that he was not focused enough on Twitter solely.