AUSTRALIA. Out of Home media company oOh!media – which has a strong advertising contract portfolio in major Australian airports – has emerged as the focus of an increasingly competitive acquisition process after receiving revised indicative proposals from a trio of private capital investors that value the business at around A$850 million (US$601.36 million).
The news, revealed by Australian financial media and research group Kalkine (see the analysis here), was subsequently confirmed by oOh!media in an Australian Securities Exchange (ASX) filing issued yesterday (15 June).
oOh!media enjoys a strong presence in airport advertising, which includes an expansive footprint at Melbourne and Brisbane airports, alongside airport lounges operated nationally by Australian flag carrier Qantas.
Kalkine revealed revised non-binding approaches from Pacific Equity Partners, I Squared Capital and Oaktree Capital Management, which have converged at approximately A$1.60 (US$1.13) per share following a three-week due diligence process.
In its ASX statement, oOh!media said it had initially received unsolicited, conditional and non-binding indicative offers of A$1.40 (US$0.99) per share from Pacific Equity Partners and A$1.45 (US$1.03) per share from I Squared Capital.
According to the statement, the board unanimously determined that neither proposal adequately reflected the company’s intrinsic value.
The company said it subsequently engaged with Pacific Equity Partners and I Squared Capital, as well as Bain Capital and other financial sponsors, providing limited due diligence access to assess whether revised proposals capable of board recommendation could be submitted.
After the three-week due diligence period, oOh!media confirmed to The Moodie Davitt Report it received revised indicative proposals from Pacific Equity Partners, I Squared Capital and Oaktree Capital Management, with some offering A$1.60 per share.
The development underlines the attraction of large-scale Out of Home advertising networks to private equity and infrastructure investors.
The company confirmed it intends to provide further due diligence access to the selected parties, a process expected to take up to six weeks.
However, oOh!media stressed there is no certainty any proposal will result in a binding offer or that any transaction will eventuate.
The Board has recommended shareholders take no action in relation to any proposal at this time and said the company would continue to update the market in accordance with its continuous disclosure obligations. ✈
