Media Prima acquires Kurnia Outdoor for $14 million in Malaysia

The acquisition boosts MPB’s total share in the outdoor space from 33 to 42 per cent.

According to a statement, the US$14 million acquisition of Kurnia Outdoor and Jupiter Outdoor Network (collectively known as Kurnia) gives MPB further access to “high-end and key market centre sites” that Kurnia currently operates.

Kurnia holds several exclusive outdoor advertising concessions on major expressways including the Sistem Penyuraian Trafik KL Barat Sdn Bhd (SPRINT), New Pantai Expressway (NPE) and Besraya in the Klang Valley and the Jelutong Expressway in Penang, among others.

“Kurnia represents a significant addition; it has an established presence in the market it operates, a strong brand name, especially to high-end advertisers, and an accomplished track record in the outdoor advertising business. Kurnia’s current management team has also agreed to be part of our group and this has added depth to our talent stock,” said MPB’s chairman, Datuk Johan Jaaffar.

“Kurnia possesses a healthy balance sheet and stable earnings derived largely from concession-based revenue streams; this will help to diversify and stabilise MPB’s earnings going forward.”

MPB owns Big Tree Outdoor, the country’s largest outdoor player. In 2008, revenue from MPB’s outdoor operations grew by more than 21 per cent and currently contributes 13 per cent to the group’s revenue. The addition of Kurnia is projected to raise total revenue of more than $30 million.

“Advertising expenditure from outdoor advertising has been increasing over the past few years and there is growing interest in it as a medium to reach out to consumers, so the strategic and profitable sites which Kurnia brings with it, as well as their future earnings potential, will definitely complement MPB’s existing operations,” said Dato’ Amrin Awaluddin, MPB’s group managing director.

Andreas Vogiatzakis, managing director of Omnicom Media Group Malaysia, said that for media agencies and buyers, they would now be looking for MPB to provide leadership for the outdoor category.

“If done right, MPB will provide leadership and management of inventory, services and more evaluation data for the outdoor space,” he said. “Evaluation data is critical and has been lacking as there has not been a common currency for us to evaluate sites. They can now elevate and build the qualitative standards for this medium.”

MPB is also in the process of acquiring Malaysia's oldest and largest newspaper publisher, The New Straits Times Press (NSTP), to create one of the country’s most powerful media groups. The company has recently shifted strategy from overseas expansion to growth at home.