APN sweetens takeover bid for HT&E’s Adshel business

SYDNEY: Australian billboard firm APN Outdoor Group sweetened its takeover bid for rival HT&E Ltd’s bus stop advertising business yesterday, heating up an international tussle for dominance in Australia’s lucrative outdoor ad market.

Four firms control 97 per cent of the A$900 million (RM2.67 billion) industry and, with digital ad boards dramatically lifting their earnings potential, they are all looking at deals in a mergers and acquisitions rush that is drawing close scrutiny from regulators.

APN had hiked by eight per cent a cash-and-scrip offer, which it said values HT&E’s Adshel business in Australia and New Zealand at A$540 million.

oOh!Media Ltd, which had the biggest market share in the sector with more than 40 per cent according to IBISWorld, had already bid A$470 million cash and HT&E said yesterday it expected more offers still.

A day earlier French advertising company JCDecaux, No. 3 by market share, offered A$1.09 billion for second-placed APN, drawing a frosty response from the Australian firm.

Driving the hurry was the sector’s strong revenue, which was climbing at a clip of an average 8.2 per cent per year, said IBISWorld, as the impact of digital billboards was robust while revenue fell in traditional television advertising.

“A digital billboard can generate anywhere between two and seven times the revenue of a static billboard,” said Morgans senior analyst Ivor Ries.