Billboard world in a whirl as offers start flying
Written on the 22 June 2018
THE battle for outdoor advertising space has stepped up a notch as APN Outdoor (ASX:APO) makes a last-ditch bid to secure the Adshel business from Here There & Everywhere (ASX:HT1).
APN has sweetened its offer for Adshel just a day after it received an unsolicited $1.1 billion takeover offer of its own from French billboard giant JCDecaux.
A key condition of the takeover is that APN does not proceed with its proposed acquisition of Adshel.
However, APN told the ASX yesterday that it continued to advance its due diligence of the Adshel acquisition.
This morning, APN stepped up its campaign with a $540 million scrip and cash offer for Adshel which is widely seen as a firm rejection of the JCDecaux takeover bid.
APN is offering $230 million in cash and 54.1 million APN shares to Here There & Everywhere shareholders for Adshel.
The $540 million price tag equates to 11 times earnings, although APN says it can create $15m of synergies over 18 months once Adshel is integrated into its business.
The latest offer sweetens the pot for Adshel, which APN had previously priced at $500 million.
The latest price is pitched at 11 times earnings and APN says the business will be immediately earnings accretive to the tune of single-digits.
While APN confirms that there is no guarantee that it can land a deal for Adshel, it says the acquisition remains an 'attractive opportunity' for the company and its shareholders.
In the meantime, APN has urged shareholders take no action in relation to the takeover offer from JCDecaux.
"There is no certainty that the JCD proposal will result in a transaction," the company says.
JCDecaux, in a highly conditional bid, is offering $6.52 for each APN share which represents an 11.5 per cent premium to the company's share price on June 20.
JCDecaux has requested a six-week exclusivity period for due diligence as well as a halt to APN's planned acquisition of Adshel.