Given the recent success of APN Outdoor, it would be interesting to see how oOh! Media sets their pricing..
CHAMP Private Equity has opted for an initial public offering for its outdoor advertising business oOh!Media, ending talks with potential acquirer Nine Entertainment Co.
Street Talk Online revealed analysts from Macquarie Capital and JPMorgan would begin briefing fundies about oOh!Media on Thursday with a book-build planned for the final week of November. Nine had been conducting due diligence on oOh!Media but was unlikely to pay the 9.4-times earnings multiple that rival APN Outdoor attracted at its recent float. It’s understood CHAMP will seek a similar multiple for oOh!Media, which would give it a market value of about $400 million to $450 million.
APN Outdoor, floated by Quadrant Private Equity, closed at $2.66 on its second day of trade on Wednesday, or 4.3 per cent above its issue price, which means the public market is valuing it at about 10-times earnings.
The success of the APN Outdoor float spurred CHAMP to also go down the public market route.
It’s understood talks between Nine, which was advised by Greenhill & Co, and CHAMP ceased last week. Nine declined to comment. Digitisation is making outdoor advertising businesses more profitable because it allows billboards to rotate ad inventory more quickly and efficiently. It is thought that APN Outdoor is more advanced in the digitisation process than oOh!Media.
Sources said oOh! would likely generate earnings of between $40 million and $50 million for 2014.
