Private equity firms became busy in trade show ownership in 15 pre-pandemic years during which average EBITDA multiples climbed from less than 10x to 15x. It seems clear that 2024 will see a universal return to pre-pandemic profits, deal multiples and private equity traffic.
It will be the year when almost every exhibition company will have financials exceeding pre-pandemic 2019. The covid comparables will be forgotten and it will be back to ‘normal’ profit growth and super-positive cashflow.
Happy days are here again.
More than that, though, we may expect pe firms whose holdings of trade show companies had been prolonged (and made more expensive) by the pandemic to exploit their peers who are salivating on the sidelines at the resurgence of a favourite investment sector.
It’s a whole decade since Onex acquired Emerald (formerly Nielsen Expositions), the largest domestic trade show group in the US. The Canada-based pe firm has been considering its options for the full or partial sale of its 90.7% stake in the listed company whose shares have increased by 50% so far this year. Emerald’s current enterprise value is some $500mn and it’s expected to make $400mn revenue / $100mn EBITDA in 2023.
Blackstone will want to sell the £450mn-revenue, transatlantic Clarion Events which it acquired in 2017. Having an estimated 20% of revenue from Hong Kong and mainland China might (or might not) be a challenge for wary US investors. We might also expect the $100mn-revenue Questex owner MidOcean Partners to be reviewing its options five years after acquisition.
The heat of the market might yet bring the £170mn-revenue CloserStill (owned by Providence since 2020) and even Hyve Group (2023) into merger / divestment deals. Some pe firms may yet persuade the family-owned, €180mn revenue EasyFairs to participate after this week releasing 2022 revenue ahead of 2019.
The rebounding industry will, inevitably, renew speculation about the future ownership of RELX’s RX (formerly Reed Exhibitions). The world’s second largest trade show group (after Informa) is expected this year to match its pre-pandemic £1.2bn revenue. But a good time to sell might also be a good time to ‘hold’ and enjoy the boom.
Then, there are the smaller companies which have made transformative strides in the shadow of the pandemic.These include the privately-owned, Anglo-Australian Terrapinn which has – almost stealthily – made the transition from conferences to trade shows. This year, the increasingly international company is forecast to break through $100mn-revenue with a 45% increase. Time, perhaps, to be either the diner or dinner.
One of the best UK-based examples of quiet, post-pandemic transformation is the Nineteen Group which was acquired by Phoenix private equity for just £10mn in 2018. It specialises in security, safety, construction and building services with major brands including: The Emergency Services Show, The Security Event, National Cyber Security Show, and Installer Show. It was founded 12 years ago by longtime UK exhibitions operator CEO Peter Jones (who had sold Counter Terror Expo to Clarion for £9mn in 2009). The company was revitalised in 2017 when Jones was joined by industry veteran Philip Soar (also CloserStill chair), prior to Phoenix buying what is now 67% of the equity; the co-founders retain 20% with the rest held by the management team.
It’s a fascinating story of how Jones has morphed from hand-to-mouth entrepreneur to corporate leader of a company now employing 150 people (x3 in three years) and seemingly set to become a £100mn-revenue business in the next few years. In some ways, it’s a dream team: Jones, the private equity-steeped Soar and managing director Alison Jackson who has managed some of the UK’s largest B2B exhibitions. They’re based in stylish Googly offices but in thrifty £55/ sq ft Wimbledon, outside London.
Until last month, Nineteen had made five £3-11mn acquisitions, totalling an investment of some £25mn in the past five years. It became profitable for the first time in 2022 and will next year have £49mn revenue and £13mn EBITDA. Its opportunism is illustrated by the way it snapped up the “slot” at London’s Olympia for the soundly profitable Retail Technology Show when RX – longtime operator of a similar event – backed-off during the pandemic.
But the Nineteen transformation was consolidated in October by its largest acquisition.
It paid an estimated £38-45mn for the £10mn-revenue construction event organiser Oliver Kinross which is thought to have EBITDA of £3-4mn. The Hong Kong-based, Brit-owned company (which employs just 34 people) operates festival-like exhibitions, complete with music and entertainment, in New York, Chicago, Sydney and London. Its London Build Expo returns to Olympia next week (15-16 Nov) and is expected to have 500 exhibitors, 500 speakers and 30,000 attendees. Executives from Nineteen (and also, presumably, its rivals) will want to see how the magic of “festivalisation” – coupled with strong seminar content – can help to modernise trade shows. In a world where exhibitions are trying hard to increase the sense of community and “value” for visitors and exhibitors, a festival atmosphere may help to captivate an industry’s (young) rising stars.
Nineteen Group is hungry for growth.
Four years of acquisitions have grown it from a UK company valued at just £10mn (its revenue in 2019) to an increasingly international trade show organiser with estimated 2025 profits of £16mn. Even before any other acquisitions, it may next year seek enterprise value bids of at least £200mn (13x EBITDA):
| Nineteen Group £mn | 2025* | 2024* | 2023* | 2022 | 2021 | 2020 |
| Revenue | 55 | 49 | 39 | 17 | 8 | 16 |
| UK % | 70% | 75% | 80% | 100% | 100% | 100% |
| EBITDA | 16 | 13 | 10 | 2 | (0.6) | (3.6) |
| Margin | 29% | 27% | 26% | 12% | ||
| Headcount | 150 | 150 | 150 | 76 | 45 | 52 |
The 2023 pro forma shows how Oliver Kinross has transformed Nineteen into an increasingly international organiser with 11% of revenue from the US and 8% from Australia. Non-UK revenues may reach 30% by 2025.
Kinross is expected to launch Singapore Build Expo in 2025 and subsequent new events, possibly in Melbourne or Los Angeles, during the two-year earnout of its founders. And Nineteen is expected to make increasingly large acquisitions, presumably in the UK and Europe. So, revenues might reach £100mn+ by 2025-26. For Phoenix (which specialises in “medium-sized UK-based businesses valued up to £200mn”) next year could be a perfect time to sell.
It’s going to be a big 2024 in trade shows.
