Stroer heading up for an IPO

By Fred Kuhlman • March 8th, 2010

Source: Business Week

March 4 (Bloomberg) — Stroer Group hired JPMorgan Chase & Co. and Morgan Stanley to prepare an initial public offering by the German outdoor advertiser, two people familiar with the plans said.

The Cologne-based company may seek to sell shares on the Frankfurt stock exchange in the first half of the year, said one of the people, who declined to be identified because the preparations aren’t official.

Stroer, which calls itself Germany’s biggest outdoor advertiser, is boosting the country’s IPO pipeline this year after share sales from Hochtief AG’s concession unit and Scan Energy A/S were shelved in December. Kabel Deutschland GmbH, the nation’s largest cable operator, chemicals distributor Brenntag Holding GmbH and clothes retailer Tom Tailor Holding AG have all announced public offerings in the last two weeks.

“In terms of traditional media, outdoor advertising is definitely one of the easiest sells for an IPO,” said Conor O’Shea, a Paris-based analyst at Kepler Capital Markets. “Outdoor advertisers trade at a very high premium because there are less structural issues like declining viewership.”

Stroer spokesman Christian Ickstadt declined to comment on “such rumors.” The company has said in the past that an IPO is “one of many theoretical options” and there is “no time pressure” he said. Stroer is “very well positioned” and plans to continue its “growth course” and is therefore considering “all options,” he added.

European Expansion

The advertising company is considering an IPO as an option to finance expansion in Europe and the U.S., the Tagesspiegel newspaper reported on Feb. 15, citing an interview with Chief Executive Officer Udo Mueller.

Stroer reported 2008 sales of 493 million euros ($673 million) and employs about 1,800 people at 72 locations in Europe and Southeast Asia, according to its Web site. The company said it has 280,000 advertising spaces worldwide, including 230,000 in Germany, and owns exclusive marketing rights at 5,700 train stations of Deutsche Bahn AG.

Half of Stroer is owned by CEO Mueller and the other 50 percent by Dirk Stroer, the son of the founder, according to Ickstadt. New York-based Cerberus Capital Management LP also has an option to acquire a 15 percent stake in the company, he said.

Lehman Brothers

European IPOs have been slower to recover than in the U.S. after New York-based Lehman Brothers Holdings Inc.’s collapse in September 2008 spurred a credit-market freeze. American offerings outpaced sales in western Europe by about four times last year, data compiled by Bloomberg show.

IPOs by Kabel Deutschland and Brenntag may be the “ice breakers” needed to start a wave of stock listings in the country this year, according to Andreas Bernstorff, Citigroup Inc.’s German head of equity capital markets.

“I could imagine eight to 10 IPOs, and it could be more,” Bernstorff said in a telephone interview on March 2. “If the first wave goes through and the market doesn’t run out of breath, then there could be even more in the second half.”

–Editors: Christiane Lenzner, Edward Evans

Comments

it is quite sad that most train stations these days are horrendously overloaded _

 

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