Acquisition Activity – Perspective From The Brokers

Most of you may have noticed a number of acquisition related articles recently on our Insider web site.  As a thought experiment we started listing them for the year.  This is the list we created with links to the articles, and we stopped after we had only gone back as far as June 1st:

Lamar acquires Land Displays 134 structures

YESCO buys Roadside Outdoor 87 bulletin faces

Link Media acquires Waitt Outdoor for $82 million

Link Media acquires Tammy Lynn Outdoor  over 250 billboard faces

Link Media acquires Key Outdoor for $38 million

Kegerreis Outdoor acquires Nations Media  over 2,500 displays

Netflix acquires 32 Regency Billboards for $150 million

Media Choice acquires X-Mark Outdoor 100 plus structures

Branded Cities acquires a portion of Red Star Outdoor.   The transaction represented less than half of the company’s faces.  Red Star Outdoor remains active in the market.

Premier Outdoor Media acquires Jersey Premier Outdoor Media  200 plus faces

Of course, there have been other acquisitions during this time frame that were either smaller or we were asked not to print a story due to confidentiality issues.

Insider asked four out of home advertising brokers the following:

It seems like transactions have increased.   Is that true and why are operators choosing to sell?

Max Drachman, Kalil & Co.

“It may appear that there is an uptick in transactional activity, but it is status quo in our office. We usually close about 15 Outdoor transactions per year, and 2018 will be very similar. That said, deal sizes have increased recently. Our typical annual volume is in the $100,000,000 range, and this year it will be closer to $300,000,000. Our recent clients have sold for a variety of reasons, with little correlation between them. Outdoor remains an attractive and secure investment for buyers inside the industry and out, so we see continued access to funding and a healthy M&A pipeline for the foreseeable future.”

Gabe Oliverio, Johnsen, Fretty & Co.

“It is true that transaction volume is increasing. We see it in the deals we’ve closed in last 12 months and in our pipeline. I think the decision to sell now is largely because it is the best time in nearly 20 years to be a seller of quality assets. Why is that? Namely, a strong macro-economy and stock market that has been expanding for nearly a decade; a strong outdoor advertising environment; acquisitions continue to be the simplest, and often the only, way for operators to gain scale; and an influx of new buyers and capital that have an appetite to pay attractive prices. Many sellers and/or potential sellers with a desire to find out what they might be worth are rightly asking themselves—“what more could I realistically want to have going in my favor?”

Paul Wright, SignValue

“We have seen a tremendous increase in transaction volume.  There are two trains of thought.  We have clients who feel like the economy is strong and they want to sell at the top of the market while optimism is high and before another recession. Other clients feel like now is the time to consolidate and they feel like any recession we have will be modest like in 2001 and 2002.  These buyers see opportunity in digital and new selling platforms.  We expect the pace to continue through this time next year.”

Marty Williamson, Williamson & Associates

“Timing is everything… in addition to the major companies, we now have several relatively new companies with lots of cash and a strong desire to grow in the industry and there are various other investment groups watching and considering making an entry. A substantial number of independents are considering selling for various reasons. For some, it has been the plan all along and now the market and valuations seem right. For others, it could be a change in circumstances for family estate purposes, partnerships or personal lives. Some sellers are interested but not extremely motivated, yet would consider selling for the right number.

If you have thoughts on acquisition activity we would like to hear from you.  Just fill out the form below to contact us.

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