Global Media Purchases Primesight and Outdoor Plus
25/09/2018
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Global Media & Entertainment birth new out of home subset Global Outdoor following the double merger of advertising giants Primesight and Outdoor Plus.
It is often difficult to assess from an outside perspective what causes large-scale mergers and acquisitions. Whether it’s to leapfrog the competition, invest in new markets or to pre-empt competition – extensive industry consolidation will inevitably cause seismic long-term effects.
In this particular case, Global Media which has a 55% market share in the radio sector, owning Capital, Heart and LBC has set its sights on the OOH market.
The deal sees Primesight which recorded an annual turn over of £61.3 million merge with Outdoor Plus (£30.5 million). The new division called ‘Global Outdoor’ is expected to receive major capital investment and significantly affect the outdoor advertising industry.
Most notably, the new company will become the fourth largest OOH media owner with an expected turnover of £300m, holding 15% of the market share behind JC Decaux (+35%), Clear Channel (+20%) and Exterion (20%).
One thing, however, will become clear, technology is the real winner here. Primesight which has a national portfolio of static roadside 48 sheets will combine with a company who specialises in digital sites. The potential here is explicit. Technology focused Global have already branched into programmatic media with their radio platform Dax, and are likely to combine these advantages to create a media owner with a national footprint of digital screens which also has the ability to create targeted geo-tagged adverts.
“The news that Global has acquired Primesight and Outdoor Plus will no doubt send ripples through the OOH-sector, whose consolidation we have long been anticipating. The move follows a period of strong growth for traditional advertising mediums, comprising OOH, TV and radio, and is a reflection of heavier industry investment into mediums which can offer both creative excellence and brand safety.
However, for the OOH industry as a whole, the entry of Global could hasten the decrease in classic billboard inventory, as the new entity is likely to focus on growing its digital portfolio. This has been evident in Global’s push towards programmatic radio with its DAX platform, and from a planning perspective, joining the dots between OOH and radio through programmatic would only add value to its proposition.
Nonetheless, consolidation in the OOH industry is a broadly positive trend insofar as it accelerates tech development and the adoption of common industry standards. We’ll be watching for further developments in this space very closely.”
Nicole Lonsdale
Chief Planning Officer, Kinetic UK
It must be noted however, there are numerous factors that determine the direction and success of a merger. Several inhibitors face newly consolidated companies including, over-estimated profitability, a clash in working culture and failure to implement a singular operational methodology between the three companies.
It is undeniable that the birth of Global Outdoor is an exciting play in a rapidly developing market. It is even more exciting however, to see how this will affect and shape the industry in the coming months.