subject: Nielsen Ipo Is Secretly Horrifying [print this page] At hand is lots of buzz on the street concerning the approaching Nielsen IPO.
If you have not heard about it, what boulder have you been thrashing underneath?
This is what is ahead my friend.
Nielsen Holdings, best recognized for its TV ratings business, has operations in approximately 100 countries and annual revenue of about $4.9 billion.
Nielsen, the television ratings and consumer research company, wishes to raise $1.8 billion in an initial public offering.
Nielsen, which is based in the Netherlands, stated in a filing with the Securities and Exchange Commission (SEC) that it will use proceeds to shrink its liability of $9 billion and for broad corporate purposes.
Pardon? So in other words, Nielsen wants to do an IPO to pay its bills. This sounds like Nielsen is in big trouble. Nielsen a short time ago had to sell its established in-print magazines Billboard and The Hollywood Reporter. They are in a huge amount of trouble.
The trouble is the niche that Nielsen has enjoyed functioning in for so many years. Nielsen no longer is queen of the niche. In theory, Nielsen appears to have been bumped down to third rank at best. The niche is now much more cutthroat than it has been in the past thanks to advances in technology.
With new technologies in cable TV and satellite broadcast services, cable operators like Comcast can sell viewership data that is collected from their cable boxes effectively destroying the need for Nielsen boxes. Most recently even Google is working to get in on the action with their Google TV that is set to be released in early 2011. Google knows the worth of data collected by cable boxes. There is just no way that Nielsen can fight against the likes of Comcast and Google.
If that is not enough logic for why you must stay away from this IPO then think about the unfriendly to IPO market we are in. There has been an unusually high number of IPOs that have ended up being priced under what was initially desired. Investors have simply been willing to buy IPOs priced at a deep mark down. Thus the question begs, how can Nielsen Holdings go for an IPO at the present time in this market? The answer may be because they have to in an effort to pay the bills.
I can think of a lot better reasons to buy an IPO such as a solar panel manufacturing business implementing an IPO to build another manufacturing plant. This is an IPO I would keep away from. There's something that rubs me the wrong way about a corporation using an IPO just to pay the bills. If that is not a enormous gigantic crimson flashing warning sign to stock traders, I do not know what is.
