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Billboards Need Lobbying Upholder
News Corp. is willing to sell to strategic investor a stake in Russia’s biggest operator of open-door advertising - News Outdoor Russia (NOR). NOR’s lobbying potential has notably shed in the past year or two and the company needs high-level support in time when authorities are closely eyeing the industry. The deal’s budget will be really big; analysts evaluate NOR’s business at $0.4 billion to $1.2 billion.
News Corp is disposing of a portion of Russia’s assets, a few banks working with billboard operators said yesterday. NOR representatives also confirmed the intention of the U.S. owners to lure a strategic investor. “In the past year, we had been persuading News Corp. to attract in business [NOR] a strategic partner in Russia. The decision was made a couple of weeks ago,” said NOR Managing Director Maxim Tkachev, without specifying the size of the offered stake and potential buyers. “We expect the process to begin closer to the fall,” Tkachev added.
The decision of News Corp. appears politically motivated, the analysts speculate. “As the company has no problems with attracting funds [it raised syndicated loan of $300 million via Raiffeisenbank past summer], the matter at stake is rather the search of some lobbying resource on the eve of the top political season in Russia, when the attention of authorities to the industry has increased,” said Trust Bank analyst Alexey Demkin.
In May, for instance, the Moscow Traffic Police (GIBDD) ordered to subordinates to stick to requirements for billboard placement, but 80 percent to 90 percent of Russia’s billboards fail to meet the standard. Moreover, it emerged a week ago that the Federal Antimonopoly Service decided that using billboards for political advertising doesn’t correspond to the Advertising Act. “The presence of Russia’s holder loyal to investors would be a certain guarantee to NOR business,” Demkin concluded.
www.kommersant.com
All the Article in Russian as of June 19, 2007
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