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Strategies & Market Trends : The Thread Formerly Known as No Rest For The Wicked -- Ignore unavailable to you. Want to Upgrade?

To: RockRidger who wrote (46326)	5/27/1999 11:44:00 AM
From: kathyh	Respond to of 90042

from cbs marketwatch... Infinity buys Outdoor Systems for $8.3 billion Deal to make Infinity owner CBS No. 1 in billboards By Steve Gelsi, CBS MarketWatch Last Update: 11:14 AM ET May 27, 1999 NewsWatch NEW YORK (CBS.MW) -- Infinity said Thursday it's buying Outdoor Systems, the No. 1 billboard firm in the U.S., in a deal worth about $8.3 billion. Infinity (INF: news, msgs), a the radio and billboard unit of CBS (CBS: news, msgs) headed by CBS CEO Mel Karmazin, is paying $6.5 billion in stock and assuming $1.8 billion for Outdoor Systems. (OSI: news, msgs). Shares of Infinity dipped 1 1/16 to 24 15/16 on Thursday morning. CBS fell 11/16 to 40 5/16. Outdoor Systems dipped 13/16 to 28. Infinity will issue about 250 million shares valued at $6.5 billion, based on an Infinity share price of $26. With the assumption of $1.8 billion of Outdoor Systems debt, the transaction is valued at approximately $8.3 billion. "The acquisition of Outdoor Systems' outstanding portfolio of out-of-home media assets extends our reach and establishes Infinity as the undisputed leader in the outdoor advertising business," Karmazin said in a statement. "Our new, industry- leading outdoor advertising company, combined with the biggest and best radio company in the business, will make Infinity the premier local advertising platform, one that is second to none." The move grows Infinity's existing outdoor advertising company, TDI, which operates 2,000 display faces and more than 1,000,000 other transit displays worldwide. Infinity will be the largest outdoor media company in the world. The move by CBS came about a week after shares of Outdoor Systems shot up 12 percent on rising speculation of a deal to buy the billboard firm. See related story. Wall Street analysts said the two sides had been in talks historically, but that they had been far apart on a purchase price. Outdoor Systems CEO Arte Moreno will be CEO of a separate Outdoor Systems unit owned by Infinity. In the pact, Outdoor Systems stock holders will have the right to receive consideration of 1.25 shares of Infinity Class A common stock, with no floors or ceilings in determining the exchange ratio. Accretive Karmazin said the acquisition of Outdoor Systems will be immediately accretive to Infinity on an after-tax cash flow basis. Outdoor Systems owns about 112,000 bulletin, poster, mall and transit advertising display faces in 90 metropolitan markets in the United States, 13 metropolitan markets in Canada and 44 metropolitan markets in Mexico, and 125,000 subway displays in New York City. OSI has operations in 50 of the 50 largest United States markets, 13 of the 15 largest Canadian markets and 44 of the largest 45 markets in Mexico. "Extending our reach in outdoor media will also provide an improved platform for growth for our local radio and CBS television stations and the CBS Television Network," Karmazin said."We are also enthusiastic about the impact this new, expanded outdoor presence will have on our growing portfolio of internet properties, which are highly dependent on branding for customer awareness on a local and national level." Infinity operates more than 160 radio stations, as well as TDI; it holds an equity position in Westwood One, Inc. CBS is a part owner of CBS.MarketWatch, the publisher of this Web site. Steve Gelsi is a reporter for CBS MarketWatch.