The Independent News & Media Group and Clear Channel, a US outdoor advertising group, have agreed to purchase South Africa's Corpcom for $58m.
Corpgro Limited, the investment banking group which owns 67% of Corpcom's shares, will remain a one-third shareholder in the new holding company.
It has agreed to sell its remaining holding to the Clear Channel/ Independent partnership in tranches over a period of five years, and in the meantime will be represented on the board.
The deal is subject to shareholder approval, but will be worth about 125 cents per share to Corpcom shareholders. Before the issue of a cautionary notice by Corpcom on 1 March 2001 its shares traded at 82 cents rising since to 117 cents.
Independent is South Africa's largest newspaper company and is owned by Independent News & Media in Dublin. Clear Channel already has a successful partnership in Australia and New Zealand with Independent's Australia affiliate, APN News & Media.
Tony O'Reilly, executive chairman of Independent News & Media said: 'Independent showed its confidence in the new South Africa before the 1994 election and since then we have made a $187.5bn investment commitment to the country.'
Independent sees outdoor advertising as an important growth sector, along with newspapers and radio. In South Africa the outdoor business accounts for around 3.5% of total advertising spend, but well below many international countries, such as France, where it is up to 15%.
The bid is the first move into Africa by Clear Channel, which operates in 45 countries. The Texas-based outdoor media and radio company specialises in out-of-home advertising industry and is capitalised at $37 billion. It also operates 1,170 radio and 17 television stations in the United States and has equity stakes in a further 240 overseas.
Corpcom said it accounts for almost half the South African outdoor ad market and operates in 17 other African countries.
