Company Continues Review of Strategic Alternatives for its Other European Businesses
Clear Channel Outdoor Holdings, Inc. (NYSE: CCO) (the "Company") today announced agreements to sell its businesses in Italy and Spain to subsidiaries of JCDecaux SE. Gross proceeds from the two separate all-cash transactions total approximately EUR 75.1 million, or US$ 80.5 million1.
The all-cash consideration represents a combined transaction multiple of approximately 9.62x Segment Adjusted EBITDA3 contribution based on twelve months ended December 31, 2022, and 7.04x based on twelve months ended March 31, 2023. The Company intends to use the anticipated net proceeds from the sales, after payment of transaction-related fees and expenses, to improve its liquidity and increase the financial flexibility of the business, subject to any limitations set forth in its debt agreements.
"The sale of our businesses in Italy and Spain is another important step forward toward our goal of optimizing our portfolio in the best interests of our shareholders," said Scott Wells, Chief Executive Officer of Clear Channel Outdoor Holdings, Inc. "Together with the previous sale of our Swiss business, we will have generated approximately $175 million5 in total gross proceeds while exiting three lower-margin and / or lower-priority European markets. The Board continues its review of strategic alternatives for our other European businesses, and we remain focused on executing our strategic priorities in our America and Airports segments."
The sale of the Company's business in Italy is expected to close imminently, and the sale of its business in Spain is expected to close in 2024, upon satisfaction of regulatory approval and other customary closing conditions. The Company has hedged the anticipated proceeds from the sale of its business in Spain to mitigate the risks related to foreign currency fluctuations.
There can be no assurance that the strategic reviews of our other European businesses will result in any additional transactions or particular outcomes. The Company has not set a timetable for completion of these processes and may suspend these processes at any time.
1 Figures based on prevailing exchange rates on May 30, 2023.
2 In aggregate, the Company's Italian and Spanish businesses contributed approximately US$ 129.1 million to Europe-South revenue and US$ 8.4 million to Europe-South Segment Adjusted EBITDA3 for the full year ended December 31, 2022.
3 Segment Adjusted EBITDA is a GAAP financial measure that is calculated as Revenue less Direct operating expenses and SG&A expenses, excluding restructuring and other costs. Restructuring and other costs include costs associated with cost savings initiatives such as severance, consulting and termination costs and other special costs.
4 In aggregate, the Company's Italian and Spanish businesses contributed approximately US$ 135.1 million to Europe-South revenue and US$ 11.5 million to Europe-South Segment Adjusted EBITDA3 for the twelve months ended March 31, 2023.
5 Figure based on prevailing exchange rates on May 30, 2023, for the Spain and Italy transactions and on December 21, 2022, for the Switzerland transaction.