Now, PE sheen for outdoor media cos

Goldman Sachs and Lehman Brothers have picked up 16% in Times OOH for Rs 200 crore. It is the latest in a string of PE moves in the outdoor media space. With multinationals like Clear Channel, JC Decaux, and News Corporation trying to buy into and clean up the sector, its value is expected to go beyond Rs 1,200 crore it is at now, reports CNBC-TV18's Ramya Ramamurthy.

The gold rush for outdoor media has finally begun. After Mumbai companies, like Laqshya and Dimple Cine Advertising, attracted money from UTI Venture Funds and Pyramid Saimira respectively, it is now Times OOH's turn to bring in PE money.

With Goldman Sachs and Lehman Brothers, valuing their 16% stake in Times OOH at Rs 200 crore, the company could now be worth Rs 1,200 crore. That is the size of the total outdoor advertising revenue pie right now.

"If you look at the airports alone, there are some 57 airports that will be on offer, either new or renovated, big or small, and they will provide a captive audience to HNI who sit there for half an hour to one hour. Times will probably reach 50 million people through them and will probably make Rs 500 crore in three years in the process. So, Rs 1,000 crore may be the size of the industry today. But that is the scale that we are talking about," said Farokh Balsara, Partner, Ernst & Young.

Scalability is what the top five billion dollar global media companies like JC Decaux, Newscorp, and Clear Channel have brought to India. Their timing has given them what you could call a last mover advantage with privatization of airports and new public transport like the metros throwing up new opportunities. 

Adille Sumariwala, Chaiman and MD, Clear Channel India, said, "It will all hinge on whether the government bodies are serious about their proposed clean up in cities. As the world's biggest outdoor company we are committed to cleaning it up with them. If Times has got Rs 200 crore, we launched here willing to spend Rs 500 crore. We just need to have the backing of the government and more long-term tenders that we can go after...

Bridging the gap between the unwieldy hoardings and the sleek digital displays may well be these mobile vans licensed out by Mumbai's Municipal Corporation to individual companies. While a recent PIL is forcing Mumbai's BMC's to implement a clean up of outdoor clutter these vans may be the ones to profit in the interim.