JCDecaux to Buy APN Outdoor for $831 Million in Australian Bet
The world’s biggest outdoor advertiser won unanimous support from APN’s board after sweetening its offer to A$6.70 a share in cash, according to a statementTuesday. That’s 2.8 percent above JCDecaux’s previous unsolicited offer and 4.7 percent higher than APN’s last closing price of A$6.40.
APN’s billboards would complement JCDecaux’s Australian business, which is focused on street furniture such as bus stops, helping the French company challenge the country’s biggest outdoor advertiser, Ooh!media Ltd. The proposed acquisition, which would be JCDecaux’s largest since it went public in 2001, comes as industry consolidation in Australia heats up after Ooh!media this week outbid APN for outdoor advertiser Adshel.
The combined JCDecaux and APN businesses would have about 35 percent of the Australian market, roughly in line with Ooh!Media, Liberum analysts Annick Maas and Ian Whiitaker wrote in a note. That’s under the 40 percent regulatory threshold in the country and is therefore expected to be approved, the analysts wrote.
“We view this deal as positive for the company as JCDecaux tends to get better yields in more consolidated markets and the deal should be largely accretive,” Maas and Whittaker wrote.
JCDecaux, which has more than 1 million advertising panels in over 80 countries, gained 1 percent to 29.14 euros at 9:10 a.m. in Paris. APN climbed 0.3 percent to A$6.42 on Tuesday in Sydney.
APN tried to merge with Ooh!media last year but gave up after the Australian industry regulator warned the deal would lessen competition in the out-of-home advertising market.
Family-controlled JCDecaux had avoided big deals in Australia, expanding gradually across the world’s seventh-biggest advertising market since winning its first contract there in 2000.
APN initially told shareholders to take no action regarding the bid from JCDecaux, as it assessed the offer and pursued the purchase of Adshel. An attempt by JCDecaux to buy a combined APN and Adshel also would have run into regulatory opposition, analysts have said.
For further details please see the original article at Bloomberg.