APN News and Media is going big and buying out the entirety of Adshel for a whopping $268.4 million, as part of APN’s business transformation from a traditional newspaper publisher to an outdoor advertising mogul.
Given growth in the outdoor ad industry is skyrocketing by 17 per cent per year, it is a bold yet strategic move from APN, who will be acquiring Adshel’s full network of digital street advertising screens in the sale, per Business Insider, creating a distinctive offering of integrated radio, outdoor, mobile and video.
Adshel was formed in 1997 as a joint venture between APN and advertising business Clear Channel, with this sale seeing APN take ownership of the 50 per cent it doesn’t currently own from a subsidiary of Clear Channel.
Adshel has 22,000 static and digital panels of street furniture ad space in the Australia and New Zealand region, with the company kicking off its digital roll-out last year. The business boasts 366 digital screens in Australia, while another 186 digital screens can be found throughout the Sydney train network.
Per BI, APN CEO Ciaran Davis said, “As the demands of advertisers rapidly change, this transaction will increase the effectiveness of implementing integrated marketing campaigns at scale, across all of APN’s businesses”.
To start with, the acquisition will put APN into debt, and per BI, is to be repaid by an equity raising of $273 million. Meanwhile, APN is offloading its print business, Australian Regional Media, to News Corp, who paid $36.6 million for it.
In August, APN reported a loss of $256.9 million for the first half of the year, with overall revenue down 0.2 per cent at $129.1 million, per BI.