Conversant gaining appeal as M&A target

Conversant Inc. (CNVR:US) is gaining appeal as a takeover target after the company formerly known as ValueClick Inc. sold website businesses to focus on digital-advertising technology.

The $1.65 billion company, which divested sites including Investopedia this year while increasing its presence in digital-video advertising, may attract traditional agencies such as WPP Plc (WPP) as they seek to gain proprietary technology, said Lake Street Capital Markets LLC. Its relatively low valuation (CNVR:US) could draw buyout interest, according to S&P Capital IQ.

Conversant trades at a lower multiple of projected profit than 91 percent of peers in advertising and marketing, according to data compiled by Bloomberg. Macquarie Group Ltd. said Conversant’s narrowed focus and the growth prospects for online marketing could increase its appeal, with the market for digital video advertising projected by Frost & Sullivan to more than double by 2016.

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