APN set to sell outdoor business to Quadrant

By AdNews | 22 October 2013
APN Outdoor's latest Adelaide roadside digital billboard.

APN News and Media looks set to sell its remaining stake in APN Outdoor to Quadrant Private Equity. The two have operated APN as a joint venture since 2011 and the figure mooted is $69 million. That represents a multiple of 7.5 times 2013 Ebitda (earnings before interest taxes, deductions and amortisation) suggesting that Quadrant sees solid returns to be made in the outdoor advertising sector.

The out of home advertising market in Australia is estimated to be worth $562m in calanedar year 2013 according to PWC.

A spokesperson told AdNews that talks were open ended but the deal looks set to go through, subject to regulatory approval.

Michael Miller, APN CEO, said the proposed transaction would be a good outcome for shareholders and was consistent with APN’s approach to having flexibility around debt repayment, investing for growth and future dividends.

“Quadrant has been a strong and supportive partner of APN Outdoor for the past 18 months and the business is well placed as the large format market increasingly adapts to the opportunities of digital media,” he said.

“APN is continuing as an active investor in the Australian outdoor advertising market through our 50% interest in Adshel, reflecting our belief that small format will continue to be a strong segment in the outdoor market.”

APN will also maintain its exposure to the Asian market through its 50% interest in Hong Kong Outdoor.

While the parties have agreed in principle to many of the key terms of the proposed transaction, it remains incomplete, with long form legal documentation still being prepared and negotiated.

APN Outdoor has over 50,000 panels across Australia and New Zealand.

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