SMG is preparing for the sale of its out door advertising business, Primesight, to GMT Communications, a leading provider of private equity for mid-market European buyouts in the media and telecoms sectors, for a total consideration of up to £62.0 million.
The initial sum of £52m will be paid in cash, while a loan note of £5m will be paid after five years or on an exit of the business by GMT. A further loan note, payable on a pro rata basis, of up to £5m, contingent upon Primesight achieving agreed target profits for the financial year ending 31 December 2007, is also payable at the earlier of five years from Completion or an exit of the business by GMT.
Commenting on the proposed disposal, Rob Woodward, Chief Executive of SMG, said: “This is a good price for the business and clearly ahead of where we were in the previous sale process. This is a strong example of the new Board delivering on its promises. The proceeds of the sale will strengthen SMG’s balance sheet while freeing the management team to concentrate on the turnaround of the television business and the disposal of our other non core businesses.”