Ann: SWM Acquisition of Prime Media, page-7

Two things I like about this transaction:

1. Discipline. The transaction signals they are seeking out value accretive transactions to further build on existing momentum without overpaying or otherwise looking for that magic "transformational" silver bullet acquisition. Altogether, shows good deal discipline.
2. Financial flexibility. Now that they have refinanced, we are seeing the financial flexibility available to SWM under the new terms of their facility, plus the facility limit at $600m shows that they are not shying away from debt, but rather are looking to use debt wisely to build a bigger business with even stronger earnings generating capacity. This augers well in terms of their capacity to execute future value accretive deals.

A very good acquisition at an earning accretive price. I think the market should like this. It also possibly signals that resumption of dividends is not far away (my logic being if they can spend money on acquisitions, then they are also now also in a position to reward shareholders with dividends). I would not be surprised to see an announcement regarding resumption of dividends at the AGM next week.