Poster contractor Maiden Outdoor is to buy bus, rail and roadside contractor British Transport Advertising, as forecast in Marketing Week on April 28, pending a referral to the Office of Fair Trading.
Speculation that London Underground ad company TDI has taken over the bus side of BTA has been denied by Maiden and TDI.
The deal, believed to be worth 5m, will make Maiden the largest 48-sheet contractor in the country, with 36 per cent of the market. The two firms had a combined turnover of 50m last year, compared to Maiden’s 29m.
Maiden will also take on BTA’s joint sales and marketing agreement with the fifth largest poster contractor National Solus Sites.
“If the OFT recommends a Monopolies & Mergers Commission (MMC) enquiry that would be a deal breaker,” says Maiden joint managing director Francis Goodwin. “We are not in a position to pay for and run a company for a year, and then make a distress sale.”
The last MMC enquiry into the poster industry in 1990 resulted in companies being limited to 25 per cent of the market for any poster size or any TV region.
“We’re making a strategic point. If you think it is important to have strong UK-owned players, then they need a strong home market to be able to expand overseas,” says Goodwin.
Goodwin declined to comment on possible redundancies, or how BTA will be integrated into Maiden. “There will be a restructuring of the business once the OFT has made its views clear. Until then the two companies will be run separately,” he says.
The deal is also subject to approval by Railtrack. There are two years left to run on a contract for BTA to handle advertising on Railtrack’s property. Goodwin maintains that Maiden has re-ceived no guarantees of an extension to the Railtrack contract.