shake up

Makeover likely for world of billboards
Email Print Normal font Large font Juliette Garside in London
May 14, 2007

A shake-up of the outdoor advertising industry which will spread as far as Australia is looming as the US-based Clear Channel Communications prepares to put its international poster business up for sale for an estimated $US3.2 billion ($3.85 billion).

Clear Channel is the largest outdoor advertising operator in Britain and claims to dominate also in Denmark, Belgium, Ireland, Italy and Sweden.

The most likely buyer is French group JCDecaux, the world's second-largest outdoor group, although private equity is likely to bid and other players such as America's Titan Worldwide and Spain's Cemusa will seek to pick off the parts that JCDecaux would have to on-sell for regulatory reasons.

In Australia, Clear Channel is 50 per cent owner with APN News & Media of the "street furniture" ads group Adshel. Street furniture, including bus shelters, is regarded as the fastest-growing segment of the outdoor advertising industry. APN, currently the subject of a languishing buyout offer from Irish media mogul Anthony O'Reilly and private equity interests, is seen as ultimately the most likely buyer of Clear Channel's stake in Adshel.

The board of Clear Channel Communications, whose main interests are in radio and television, is awaiting a shareholder vote on May 22 for a proposed takeover by private equity groups Thomas H Lee and Bain Capital Partners. The poll has been postponed three times to allow the bidders to increase their offer, which now stands at $US39.20, with an option to secure equity in the new company. If the board thinks shareholders will approve the buyout consortium's latest offer, the vote will be delayed by three months to allow for amendments to the original deal to be approved by regulators.

Whether or not the takeover goes ahead, Clear Channel Outdoor's assets outside the US are likely to go on the block, with the sale process beginning within weeks of the vote.

JCDecaux, which is quoted on Euronext in Paris and run by its founding family, has made no secret of its desire to acquire Clear Channel. Jean-Francois Decaux, a co-CEO, told investors in March: "It's clear that we would be interested." Clear Channel declined to comment.

Telegraph, London