APN to sell out of outdoor advertising JV with Quadrant for A$69 mln
APN News & Media, which publishes the New Zealand Herald newspaper, has agreed to sell its stake in an outdoor advertising joint venture with Quadrant Private Equity for some A$69 million.
The deal will see APN sell its 48 percent of APN Outdoor at a multiple of 7.5 times earnings, before interest, tax, depreciation and amortisation, the media group said in a statement. The sale price is more than the A$51.6 million carrying value attributed to APN's stake in the joint venture as at June 30.
"APN is continuing as an active investor in the Australian outdoor advertising market through our 50 percent interest in Adshel, reflecting our belief that small format will continue to be a strong segment in the outdoor market," chief executive Michael Miller said.
APN entered into the joint venture last year, selling a controlling 52 percent stake to Quadrant for A$190 million, and generating net proceeds of A$174.2 million. The outdoor advertising unit has more than 50,000 panels across Australia and New Zealand, with formats ranging from digital and static roadside billboards to transit, rail and airport advertising.
The media group has been selling assets and clamping down on costs as it looks to return to profitability and reduce debt, while operating in a sector where revenue streams are dwindling as customers eschew paying for news.
APN has undergone a radical overhaul this year with a board-room shakeout and new chief executive appointment when major shareholders Independent News & Media and Allan Gray Australia baulked at a planned capital raising.
The deal is subject to regulatory approval by the Foreign Investor Review Board and Quadrant's debt funding arrangements.
APN shares, which are dual-listed, rose 2.1 percent to 47 cents on the NZX today, before Australia's market opened.