Rentrak shares reached their all-time high Thursday after the company announced deals to buy its Kantar Media’s U.S. TV measurement assets for $98 million in stock and an agreement with top tier media buyer Group M which will use its set-top box data for planning and buying ads.
Rentrak shares traded as high as $75.39 each early Thursday, up 17% ($10.88 each), before slipping slightly to finish the day at $72.07 each, up 12% or $7.56 per share. The stock beat its old high-water mark of $69 per share, soundly.
Rentrak’s gains came as the Dow Jones Industrial Average plunged more than 300 points on Thursday.
In contrast, shares of TV measurement leader Nielsen dipped about 4% ($1.72 per share) on Oct. 9.
The Kantar Media deal, valued at about $98 million in Rentrak stock (12.4% of outstanding shares), will give the Portland, Ore.-based company a stronger presence in local and national TV measurement. In addition, Kantar and Group M parent WPP said it will purchase about $56 million worth of Rentrak shares, upping its stake to 16.7%. The media giant has agreed not to raise its interest in the company above 20%.
With Group M, Rentrak gains a client that makes about $105 billion in ad billings globally and one that shapes the relationship between TV networks and advertisers – it led the push for C-plus-3 ratings in 2007, now the industry standard.
In a research note to clients, Wunderlich Securities media analyst Matt Harrigan called the WPP deals “pivotal,” adding that with the ability to raise its interest in Rentrak as high as 20%, WPP is the “default likely winner in any eventual full acquisition of Rentrak. It also positions Rentrak as the only massive and passive (census) based provider in the U.S. market.”