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Hoyts bankers up as Val Morgan, QMS idea progresses
Australian Financial Review, Australia  14 Sep 2018
Companies and Markets - Page 18 - 262 words - ID 1008443525 - Photo: No - Type: News Item - Size: 101.00cm2

Hoyts Group has stepped up its thinking about an out-of-home advertising deal with ASX-listed company QMS.

Street Talk understands Hoyts has drafted in veteran UBS investment banker - and WPP AUNZ chairman - Rob Macn'er to help progress what started as an idea and a chat between chairmen. It is understood the mooted structure would see Val Morgan merged into QMS and the combined entity could trade on the Australian Securities Exchange.

Hoyts and its owner Dalian Wanda would take about 45 per cent of the listed company, and a few board seats.

Both businesses are understood to have about $45 million in annual EBITDA which means the combined unit could be worth about $750 million based on other deals in the sector.

Sources said it was one of those longmooted mergers, where both parties keep an eye on each other but need a catalyst to get serious about a deal.

Parties involved hope that catalyst may have come via the combination of larger outdoor advertising rivals JCDecaux and APN Outdoor and oOh! media and Adshel. For QMS, it could be a chance to become a bigger company and attract more attention from smallcap fund managers who know its story but struggle to get involved because of its size.

For Hoyts, it could help owner Dalian Wanda crystalise some value and help create options for the rest of its Australian business, including cinemas and the like, down the track.

Sources said the big question was whether QMS chief executive and major shareholder Barclay Nettlefold could get comfortable with the potential deal.

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