oOh!media has rejected two takeover proposals from private equity bidders, saying the offers do not reflect the outdoor media company’s intrinsic value.
The company confirmed it had received a non-binding indicative proposal from I Squared Capital at $1.45 per share, following an earlier $1.40 per share offer from Pacific Equity Partners.
The oOh!media board has rejected both offers but will provide the two bidders with limited due diligence information to assess whether to return with revised proposals.
Board says offers undervalue oOh!media
In an ASX update, oOh!media said its board had considered both proposals with advisers and determined neither should be recommended to shareholders.
“The board of directors of oOh!media Limited has considered both proposals in conjunction with its advisers and has unanimously determined that neither proposal adequately reflects the intrinsic value of oOh!,” the company told the ASX.
“The board has informed both PEP and ISQ that it does not intend to recommend to shareholders any formal binding offer at or below the value of their respective non-binding indicative proposals.”
Other parties circling
oOh!media said it is also engaging with other interested parties and may receive further change-of-control proposals.
“oOh! is open to engaging with all parties to assess whether any proposal may emerge that is capable of being recommended by the board,” the company said.
First offer
Pacific Equity Partners has reportedly made a $747 million non-binding indicative offer to acquire ASX-listed out-of-home media company oOh!media.
As first reported by the Australian Financial Review’s Street Talk column, the private equity firm has put forward a $1.40 per share proposal, representing a 65 per cent premium to oOh!media’s last traded price.
The offer also represents a 50 per cent premium to the company’s one-month volume-weighted average price. oOh!media was trading at 85 cents per share, giving it a market capitalisation of about $477.5 million.
New CEO’s plan underway
The takeover interest comes as James Taylor, the former managing director of SBS, settles into the chief executive role after replacing Cath O’Connor.
Taylor has promised a more responsive outdoor media company, including investment in tools designed to make it easier for sales teams and customers to work with oOh!media.
The company’s latest financial results showed revenue lifted 8.8% to $691.36 million for the year to December, despite a tougher advertising market in the second half.
Adjusted underlying net profit after tax rose 7% to $63 million, while oOh!media declared a fully franked final dividend of four cents per share, up 14%.
Mediaweek reached out to oOh!media for further comment, but the company responded with “Not at this time.”
Top image: oOh!media