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APN News & Media to buy rest of Adshel and digital publisher Conversant Media

US giant Clear Channel looks set to exit the Australian media market with APN News & Media set to buy its 50% stake in outdoor company Adshel for $268.4m.

adshel

The move, which will be funded by a capital raising by APN of $271m, sees the company take 100% control of Adshel, which has 22,000 outdoor panels across Australia and New Zealand.

APN also announced today it is purchasing Conversant Media, which publishes websites including The Roar, Lost at E Minor and Techly, for upfront cash consideration of $11.6m and performance based earn-outs.

In a statement to the Australian Securities Exchange this morning (ASX:APN) the company said the Adshel purchase is consistent with APN’s plans to focus on “high growth areas” of media.

CEO, Ciaran Davis, said: “It will allow the Adshel management team to drive the strategic direction of the business and pursue opportunities that facilitate growth, including a continued focus on innovation and the progressive digitisation of the portfolio.

“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.”

Those other businesses include the Australian Radio Network which APN bought Clear Channel out of in early 2014, and includes the Kiis and Gold networks.

The company is also in the midst of trying to offload its struggling regional papers to News Corp, as it looks to exit the print space.

However, the purchase of Conversant, which was named Small Publisher of the Year at the recent Publish Awards, suggests the company sees a future around niche digital media as part of its advertiser offering.

conversant-media

The purchase price of Adshel represents a 12.7% multiple on historic EBITDA. In the statement it said Adshel made $170m in revenues in the past financial year, with an EBITDA of $42m.

The acquisition is expected to go through today.

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