TIDMINF
RNS Number : 2915Y
Informa PLC
02 March 2017
Press Release
2 March 2017
Informa PLC
Informa acquires largest boat show operator in US
Informa to pay GBP106m for Yachting Promotions Inc., further
strengthening Global Exhibitions Division and increasing US market
presence
Key highlights
-- Targeted expansion...Addition of five US exhibitions with
strong portfolio fit including Fort Lauderdale, Miami and Palm
Beach boat shows
-- Strengthened position...Complements Informa's ownership of
the Monaco Yacht Show, creating leading international position in
attractive and growing vertical
-- Divisional scale...Global Exhibitions to become Informa's largest division
-- US reach...Combination further extends North American
presence, accounting for more than 50% of Group revenue
-- Attractive structure...Consideration of GBP106m represents a
multiple of 11.5x EBITDA and sub-10x including tax assets of $34m;
acquisition expected to be immediately accretive to adjusted
Earnings Per Share.
London: Informa (LSE: INF.L), the International Exhibitions,
Events, Business Intelligence and Academic Publishing Group, today
announced the agreed acquisition of Yachting Promotions Inc.
("YPI"), the operator of some of the largest yachting and boat
shows in the US, for GBP106m.
The addition of YPI from Active Interest Media ("AIM"), the
privately-owned specialist US media group, will combine several
major US-based international yachting exhibitions with Informa's
Monaco Yacht Show, the leading event of its kind in Europe. The YPI
portfolio includes the Fort Lauderdale International Boat Show, the
largest in the world.
Stephen A. Carter, Informa Group Chief Executive, said:
"Following three years of private discussions, we are delighted
to bring YPI into the Group. It will deepen our leadership in the
growing international yachting and boating sector, with its
attractive exhibitions complementing our existing ownership of the
Monaco Yacht Show.
"It follows the addition last year of Penton Information
Services in the US, increasing our scale in the world's leading
economy and making our Global Exhibitions Division the largest
business by revenue and profit at Informa. This forms part of our
2014-17 Growth Acceleration Plan, adding further Balance and
Breadth across the Group portfolio."
Efram 'Skip' Zimbalist III, Chairman of Active Interest Media,
said:
"I am confident that Informa will be a great owner of these
powerful US shows. We've long admired the Monaco Yacht Show, and
through our discussions over the last three years, we can see that
the combination represents a very attractive outcome for both sets
of exhibition brands and the growing international yachting
community."
further scale in global exhibitions and the US
On completion, the addition of YPI will make Informa's Global
Exhibitions Division the largest contributor to Group revenues and
profit, with annual sales of more than GBP500m. The Division
operates a portfolio of about 200 major Exhibition Brands.
YPI is the leading US-based Exhibitions business in the growing
International Yachting industry, with five major Exhibition Brands:
Fort Lauderdale International Boat Show, Yachts Miami Beach, Palm
Beach International Boat Show, Suncoast Boat Show and the St
Petersburg Power and Sailboat Show.
The Fort Lauderdale International Boat Show attracts 100,000
attendees, 820 exhibitors and more than 1,200 boats annually each
November. Established in 1959, its successful track record over
several decades underlines its enduring Brand strength and the high
barriers to entry for in-water boat shows due to the significant
logistics expertise and local permits required to run them
effectively.
YPI's focus on International Yachting events in the US is highly
complementary to Informa's leading position in Europe through the
Monaco Yacht Show. The combination will create a scale player in
this attractive and growing vertical, extending Informa's
relationship with leading yacht brokers and builders, and providing
good opportunities for cross-promotion and enhanced customer
relationships across platforms and geographies.
The addition also further increases Informa's scale in the US,
where the Group has been buying and building a position over recent
years through a combination of organic investment and a series of
targeted acquisitions in verticals including Construction &
Real Estate (Hanley Wood Exhibitions, WWETT), Natural Products
(Virgo, Penton), Agriculture (Penton), Life Sciences (FIME) and Pop
Culture (Orlando MegaCon, Dallas Comicon).
The YPI combination forms part of the 2014-17 Growth
Acceleration Plan, in which Informa has focused on building scale
in a number of attractive and growing and increasingly
international industry verticals, which enhance customer
relationships, revenue mix, growth potential and predictability of
earnings.
Following the addition of YPI, on a pro-forma basis the US is
expected to represent more than 50% of Group revenues and also over
half of the Global Exhibitions Division.
Financial impact of the addition
YPI has a consistent track record of growth in revenue and
adjusted operating profit over recent years, reflecting the
strength of its Brands and attractive growth in the International
Yachting industry.
The combination follows exclusive talks with Wind Point
Partners, the private equity group behind Active Interest Media
(AIM), the parent company of YPI. AIM is a US based
specialist/enthusiast diversified media Group.
Under the terms of the combination, Informa will acquire 100%
control of AIM's Yacht Exhibitions business while retaining a
long-term cross-marketing agreement with the parent company,
replicating the structure adopted when Informa acquired Hanley Wood
Exhibitions in 2014.
The cash consideration for 100% of the equity of YPI is $133m
(GBP106m), including $5m which is subject to the business meeting
performance and operating targets. Based on its results in the 12
months ended 31 December 2016, this represents a trailing
acquisition multiple of 11.5 times EBITDA. The business also brings
with it around $40m of net operating losses that are deductible for
US tax purposes over a number of years, equating to a net present
value of $33.9m. The inclusion of these tax assets implies a
multiple of 8.6 times EBITDA.
Four of YPI's five major events are yet to run in 2017. While
management has plans to invest in the business to reap the full
benefits of scale and make the most of its strengthened position in
the International Yachting vertical, the transaction is expected to
be immediately enhancing to adjusted Earnings Per Share. It is also
expected to generate a post-tax return on investment ahead of
Informa's weighted average cost of capital within three years of
ownership.
The consideration will be funded through existing debt
facilities. It is anticipated that the Group's net debt to EBITDA
ratio will be around 2.6 times immediately following completion,
falling within the Group's target range of 2.0 times to 2.5 times
by the end of 2017.
Completion is expected by early March.
On 6 March, Informa will announce full-year results for the
12-month period ending 31 December 2016.
Enquiries
Informa PLC
+44 (0) 20 7017
Stephen A. Carter, Group Chief Executive 5771
+44 (0) 20 7017
Gareth Wright, Group Finance Director 7096
Richard Menzies-Gow, Director of +44 (0) 20 3377
Investor Relations 3445
Teneo Strategy
+44 (0) 20 7240
Tim Burt / Ben Ullmann 2486
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Notes to editors
Informa is a leading international Business Intelligence,
Exhibitions, Events and Academic Publishing Group with annual
revenues of over GBP1.6bn. It helps commercial, professional and
academic communities work smarter and make better decisions faster,
through specialist content and intelligence, and opportunities to
connect and learn.
This information is provided by RNS
The company news service from the London Stock Exchange
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