Our sister website www.billboardinsider.com has published a terrific interview with outdoor advertising broker Max Drachman. We’ve reproduced the interview here.
Investment banker Max Drachman of Kalil & Co has been busy doing outdoor transactions. Insider asked Max to talk about the outdoor M&A market. You can reach Max at firstname.lastname@example.org, 520-795-1050.
Max Kalil and Co has been busy in the first quarter. What have you done?
Yes, we have had a great quarter. We have closed three Outdoor deals so far:
- Jag Outdoor- We sold Jag Outdoor in northeast Wisconsin to Link Media. Jag was a 70 year old billboard company. Most recently it was run by Jane Sweasy who did a great job operating the plant after the passing of her father Gerald Haegele. She asked us to quietly bring her some options, and the best deal for her family came in the form of a purchase by Link Media. Link is a relatively new Outdoor company headed by Sean Cash. We sold them Bell Media in Alabama in 2015, and Jag is their second major purchase.
- Mashburn Outdoor – We sold Mashburn Outdoor’s assets in east Tennessee to Allison Outdoor. Mashburn took advantage of smart digital conversion to increase the value of his plant. The acquirer, Allison Outdoor, is one the largest independents in the south, and their entrance into Johnson City fits very well with the operational strategy of their new quarterbacks, Claude Dicks and Gary Ayers.
- Astra Pacific – Last week we closed a deal divesting Astra Pacific to AllOver Media. Astra Pacific had large format wallscapes, and advertising rights on double decker buses in Los Angeles and New York. Astra Pacific was started by Astred Rodriguez and grew to one of the leading bus advertising companies in the country. AllOver is backed by Audax and they are quickly expanding their platform. AllOver is headed by Tony Jacobson and Shaun Nugent and they are building AllOver into a major player.
Any trends in the outdoor M&A market?
I have noticed a resurgence in M&A for independent Outdoor companies. In Lamar’s last earnings call, Sean Reilly mentioned the healthy state of the business and specifically the large stable of well funded independent Outdoor companies that are active. I agree with him wholeheartedly. In the deals above and in virtually every deal we close now, there seems to be a handful of independents at the finish line. The next twelve months will be a great opportunity for independents to continue their buying streak while the larger players digest some their recent acquisitions.
Care to speculate on what markets Clear Channel Outdoor may want to sell next?
Good question. I know their parent company has some issues with their debt load, but it wouldn’t surprise me if Clear Channel Outdoor bought more domestic assets before they sell again. On the other hand, and unfortunately for Clear Channel Outdoor, Outdoor multiples are essentially double that of radio right now, so if iHeart decides to take some more chips off the table to pay down debt, selling billboards gives them the best bang for their buck.
Any predictions for the TAB/OAAA conference this year?
We are expecting a very busy conference. We have already had several buyers and sellers reach out to us to set up confidential meetings. We also have a couple of projects underway that we are excited about and hope to make a few exciting announcements before the conference.