oOh!media launches $167 million equity raising
Outdoor advertising specialist, oOh!media, has launched a new package of measures that bring stability and certainty for its stakeholders, with a $167 million fully underwritten equity raising.
Marketing conditions are undoubtedly tough, particularly for the out-of-home sector, at a time when people are confined to their houses. This move is a reassuring update for stakeholders from a company that has been very publicly adapting to quickly changing circumstances over the past fortnight.
oOh!media has confirmed the widely reported trading halt wasn’t a liquidity issue, but that management believed “it was prudent to pursue measures that improved balance sheet flexibility” given the current economic circumstances.
Brendan Cook, who previously announced his retirement from the company, has committed to remain CEO until at least the end of CY20, to minimise disruption at this time. Under Cook’s watch, some of the key stabilising measures will include new cost control measures with potential savings estimated from $20-30 million.
These measures are supported by oOh!media’s investors, which includes HMI Capital, Australian Super, Fisher Funds and Harris Associates.
Mick Hellman, founder and managing partner of HMI, will also be appointed to the board. In a statement oOh!media said this placement puts the company in a strong position once the market recovers: “His approach to strategic investment decisions involves favouring management teams that have a strong growth orientation, balanced with disciplined and thoughtful use of resources in pursuit of that growth.”
Charmaine Moldrich, CEO of the Outdoor Media Association, says there is hope for the sector and pointed to some of the ways outdoor advertising is still very relevant in this particular moment, mainly for education, maintaining a sense of normalcy for the public and for presenting opportunities for brands to connect in meaningful ways.
“We are a media channel that is very adaptable, we can broadcast, we can narrowcast, we are flexible. Now is not the time to look for superficial wins and bargain basement media. Now is the time to build demand and brands. Now is the time for leaders to step up. It is in this moment of crisis that we need to act in all our best interest so that we get through this in one piece together,” said Moldrich.
Although the media earnings were tracking to plan for oOh!media, with a noticeable shift in how people are living their daily lives, the out-of-home sector is now working closely with customers to evolve with new social patterns.