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Largest-yet financing to Russian outdoor advertising firm
$28 million loan to encourage transparency, restructuring in booming sector
The European Bank for Reconstruction and Development is lending $28 million to
the largest outdoor advertising operator on the Russian market, News Outdoor
Russia OOO. The loan, the largest financing of a Russian outdoor advertiser to
date, should encourage best international business practices, transparency and
restructuring in a booming sector of the economy.
The EBRD will provide $20 million of its own funds, and has syndicated the
remaining $8 million to Austria’s Raiffeisen Zentralbank Oesterreich AG.
The proceeds are to be used mainly to improve the group’s capital structure,
facilitate its regional expansion across Russia and finance a technological
upgrade of its installations.
News Outdoor, which is indirectly controlled by Rupert Murdoch’s The News
Corporation Limited, is the biggest operator in Russia’s highly fragmented
outdoor advertising market. The country is witnessing an explosive demand for
advertising services, and its share of outdoor advertisements in total
advertising expenditure is Europe’s highest.
The EBRD believes this transaction will send an important message to an
industry which has historically lacked transparency by showing the clear
connection between the group’s good practices and the access to external
finance it has now obtained, said Izzet Guney, Director of the EBRD’s
Telecommunications, Informatics and Media team.
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