APN Outdoor CEO Warburton refuses to be drawn on his future or redundancies, after sale to JC Decaux
APN Outdoor’s CEO James Warburton is pleased his frantic negotiating with international outdoor giant JC Decaux ended in a sale agreement, however won’t divulge the implications for the company’s branding, staff, or his future.
Speaking to Mumbrella after the $1.119 billion sale was announced to the ASX – after days of media speculation, rushed international negotiations and a trading halt – Warburton said a lot of the intricacies and ultimate outcomes of the deal still need to be ironed out.
Warburton has been ‘fortunate’ to lead the APN Outdoor business for five months
The uncertainty and lack of official detail is despite a 94-page Scheme Implementation Deed between the two companies being posted to the ASX this morning.
Pushed on whether the deal involved him remaining on as leader, or if his duties would be absorbed into those of JC Decaux’s current local leader Steve O’Connor, Warburton instead focused on the hurdles the deal still faces in getting approved – including securing the tick of approval from the ACCC, FIRB and the OIO in New Zealand – and the importance of running the “business as usual” in the meantime.
“I think the management team and the staff here, they’re incredible, very experienced operators,” he told Mumbrella of his future. “I think I’ve been very fortunate to lead the business for the five months, and I’ve got a very, very skilled team here… I think for the staff, and I said to them this morning, it’s an enormous opportunity.
“The largest outdoor advertising company in the world [JC Decaux], all the innovation they bring, the creativity, the focus on research, systems and all of those things, and obviously the premium of the brand – for them [the APN Outdoor staff] to join 13,000 other employees around the globe – so I think from that perspective, the staff are extremely positive and in time, I’m sure those types of things will be worked through.”
Warburton was also reluctant to give an on-the-record answer to how the deal would impact local staffing numbers.
Yesterday’s announcement that Ooh Media would purchase JC Decaux’s rival in the street furniture business, Adshel, for $570 million, came with the revelation that $15 million to $18 million in “cost synergies” would be found when the two companies come together – which will include a headcount reduction.
On his staff count, however, Warburton couldn’t give an official answer, and instead pointed to the strength of APN Outdoor’s business, noting its $350 million in revenue, and its guidance of $92 to $96 million EBITDA.
Warburton’s final answer on the question again pointed to the various steps the deal needs to take before being completed, adding “There’s a long way to go. It’s quarter four, and we’re just getting on with business, and I’m sure the detail of that will be worked out in due course”.
Mumbrella understands the APN Outdoor business is likely to be absorbed into JC Decaux – in the same way that ‘Adshel’ will disappear three months after its deal with Ooh Media is finalised – however it is also understood this discussion is yet to officially take place.
In response to the question, Warburton again pointed to APN Outdoor’s strong financial position and its scale in the local market.
He also would not predict the outcome of an ACCC decision on the merger, even though rival Cook from Ooh Media is once again confident his own deal will pass the test.
While noting he respects the ACCC’s process and its ultimate control over the outcome, Warburton said he doesn’t believe JC Decaux’s purchase of APN Outdoor would actually lead to a lessening of competition.
“The combined share of APO [APN Outdoor] and JCD is less than 30%, and we have no overlap in our formats. So JC Decaux’s business is… street furniture, and of course, we’re billboards, transport and airports – so there’s very limited cross-over between the parties,” he said.
On the record, Warburton could confirm his joy that the deal had made it across the line in such a short period of time.
“I think it’s absolutely fantastic for our shareholders, for our staff and for our landlords,” he said. “It’s huge… for the Australian media, and obviously for advertisers… And it’s pretty amazing to have pulled together the transaction effectively in four days.”
