Group Press Releases
Aegis Media Expands in Out-of-Home in China
13 December 2007
Aegis Group plc (“Aegis”) today announces that it has signed an agreement to acquire a 70% shareholding in Heartland Media Group in China and Hong Kong from a group of private owners for an initial cash consideration of £4.6m, subject to the necessary approvals. The consideration will be satisfied from Aegis’s existing resources.
A further cash consideration will be payable over four years, subject to very strict performance conditions, up to a maximum of £31m. From 2011, the remaining Heartland shares will be the subject of a five-year call option from Aegis and a put option from the vendor.
Following the acquisition, Heartland will become part of the Posterscope Worldwide network, led by Posterscope ceo Annie Rickard, and Jay Lin will remain as ceo of Heartland.
Heartland is China’s leading independent out-of-home media agency, offering a full range of services, including planning and buying; creative, production and implementation; monitoring and maintenance. Its clients include Nokia, Hitachi and The Coca-Cola Company. Heartland has gross assets of £0.8m and in the year to December 2006 achieved profit before tax of £1.5m.
China is currently Asia’s second largest advertising market, and is growing at 20% a year, with out-of-home growing ahead of the total market. Out-of-home has a unique role to play for brand communications in a rapidly developing economy with an urban population of 130m people. Out-of-home media is expected to receive further boosts from the Beijing Olympic Games in 2008 and the Shanghai EXPO in 2010. As a result, Heartland is well-positioned to deliver strong growth in both revenue and profit.
Commenting on the acquisition, Robert Lerwill, ceo of Aegis,
said:
“Posterscope is the leader in out-of-home worldwide, and
this acquisition extends that lead at exactly the right time, in
the right place. Out-of-home in China is one of the sweetest spots
in our industry - this is an exciting acquisition, with immense
potential for growth ahead, and we have high expectations for its
future success.”
For further information contact:
Charlotte Elston
Aegis Group plc
+44 (0) 20 7070 7708
Charles Palmer
Financial Dynamics
+44 (0) 20 7831 3113
