Private equity firm heading towards QMS Media deal

QMS Media has assets in the Australian and New Zealand markets

Speculation is mounting that a private equity firm is working towards a deal to buy outdoor advertising company QMS Media, which some expect will be announced in a fortnight.

The media company has been in talks with private equity this year for a potential acquisition, as previously flagged by this column.

Earlier in the year, a private equity firm ran the ruler over QMS, but sources now say that the company is in the process of being sold within the coming days.

One of the challenges for QMS has been the round of industry consolidation last year, in which JC Decaux purchased APN Outdoor for $1.12bn and oOh!media acquired the outdoor operations of Here, There and Everywhere, leaving the business predominantly as a radio station owner.

QMS owns assets in the Australian and New Zealand market, and the attraction for private equity has been the level of advertising the company generates.

Earlier, some believed its recent merger of its New Zealand operations with Mediaworks could act as somewhat of a poison pill when it comes to private equity, given that most do not want exposure to free-to-air television while it struggles to compete with digital streaming services such as Netflix.

Some analysts believe they may also be averse to its QMS Sport division, which sells ads for sports events at stadiums.

Mediaworks last week officially placed its New Zealand television stations on the market through UBS.

Chief executive Barclay Nettlefold has spent a large amount of time this year in the US promoting his QMS Sport business, which some had earlier suggested was a trip that also doubled as an exercise to find a buyer or equity backer for the operation.

Lately, Australian private equity firm Anchorage Capital Partners has been active looking at media assets, while some have suggested that Kohlberg Kravis Roberts could be interested in QMS, although the broadly held view is that the business would be too small for the New York-based buyout fund.