After auditing Wall CIS, BigBoard may set up Russia's third-largest outdoor advertiser. The billboard in the photo says: "Buy!"
Photo: Sergey Mikheev
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JCDecaux Acquires Wall’s Russian Subsidiary
The world’s second-largest outdoor advertiser JCDecaux has received Germany-based Wall’s Russian asset to integrate it into a company which will become a top three outdoor operator in Russia. But first, the French will have to settle a dispute with city officials in Moscow and St. Petersburg.
French JCDecaux and German Wall, where JCDecaux holds 35 percent, announced an exchange of assets late last week. Under the deal, JCDecaux has received 100 percent in Wall’s Moscow subsidiary, Wall CIS. JCDecaux owns another Russian advertiser, BigBoard.
JCDecaux is the world’s largest outdoor advertising firm second to Clear Channel Outdoor. The firm reaped ˆ1.946 billion in profits last year. Earnings of JCD’s subsidiary BigBoard are estimated to be over $15 million in 2006.
Wall AG has been working in Russia since 1992 with estimated profits in 2006 more than 3 million.
BigBoard will have Wall CIS audited within the next two weeks and then consider integrating the asset into another company, Ruslan Zheludik, BigBoard’s general, said in an interview with Kommersant. Should BigBoard merge with Wall Russia, the new company will become Russia’s third-largest in the number of billboards, according to Andrey Berezkin, director general of ESPAR-Analitik.
BigBoard, however, still has to resolve conflicts with Russian officials. St. Petersburg’s city hall in March declined to renew the 15-year contract with Wall for placing advertising structures in the city. In Moscow, Wall has a contract valid through 2012 but city authorities are contesting it in court. The German company may have handed the asset to JCDecaux, seeing that “relations with Russian authorities have reached a stalemate”, says Andrey Berezkin. Still, analysts estimate JCDecaux’s chances to settle the conflicts as high.
www.kommersant.com
All the Article in Russian as of Mar. 12, 2007
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