AUSTRALIA'S APN News & Media has entered exclusive talks to sell its remaining stake in an outdoor advertising unit for A$69m (€49m).
APN, which is 29pc owned by the publisher of this newspaper, Independent News & Media (INM), is selling the unit to Quadrant Private Equity. The two companies have operated the outdoor unit as a joint venture since May 2012. The two companies said the key terms have been agreed but the deal remains incomplete.
Simon Grotty, an analyst with Davy Stockbrokers in Dublin, said cash generated by the sale would help both APN and INM.
INM has said it will go to shareholders by the end of the year with a rights issue to repay €40m of debt.
"The cash generated will reduce any future capital calls to APN shareholders and Independent News & Media in particular," Mr Grotty said yesterday.
APN said it will remain an active investor in the Australian outdoor advertising market through its 50pc stake in bus shelter advertiser Adshel.
APN shares rose as much as 7pc during trading yesterday as investors welcomed the move.
APN said the sale price represented 7.5 times the 2013 earnings before interest, taxation, depreciation and amortisation for the group. The Australian publisher added that the transaction would help streamline the business and provide increased flexibility.
"Quadrant has been a strong and supportive partner of APN Outdoor for the past 18 months and the business is well placed as the large format market increasingly adapts to the opportunities of digital media," said APN chief executive officer Michael Miller.
"APN is continuing as an active investor in the Australian outdoor advertising market through our 50pc interest in Adshel, reflecting our belief that small format will continue to be a strong segment in the outdoor market."
APN also maintains exposure to Asia through its 50pc interest in Hong Kong Outdoor.