Industry/Sector: Out-of-Home Media
Deal Type: M&A – Sell Side Advisory
FourBridges Team: Charlie Brock (client)
Client Profile: Founded in 1998, Foxmark offered a mix of static and scrolling displays in over 120 malls in the United States. The company contracted with mall owners to install backlit displays, update directory maps, sell advertising panels to national, regional, and local clients, and pay mall owners a % of the ad revenues. Foxmark was a leading provider of mall advertising nationwide and offered advertisers coverage in some of the most prominent, highly-trafficked malls in the country.
Client Objective: As digital displays were coming into vogue in the OOH industry, management recognized the eventual migration of advertising dollars from the static/scrolling format to digital. Management determined that rather than dilute its shareholders by raising venture capital to install its own digital network, the timing was right to sell the company to a strategic competitor who already offered digital displays. Management wanted to ensure ongoing job opportunities for its employees, while maximizing value for the angel investors who had provided growth capital in 2001 and 2003.
The Challenge: There were a limited number of potential strategic buyers, presenting a challenge of how best to maximize value without running a full M&A auction process.
The Process: FourBridges professionals positioned the company to the Australian acquirer, illustrating the strength of Foxmark’s contracts with mall owners and advertisers, management’s knowledge and expertise in the U.S. mall advertising industry, and the company’s strong operating results the past several years.
The Result: FourBridges professionals negotiated the sale of 100% of the company. The purchase price represented greater than an 11x EBITDA multiple, providing a 78% IRR to the 2003 investors. Significant growth opportunities were provided for the employees of Foxmark in the new, larger enterprise which was a rollup of several US entities.
FourBridges Capital Advisors is a middle market investment bank providing sell-side, buy-side, capital raising, restructuring, and strategic advisory services primarily to closely-held and family-owned businesses. FourBridges is based in Chattanooga, Tennessee, and serves clients in cities across the Southeast, including Atlanta, Nashville, Birmingham, Memphis, Knoxville and Huntsville.
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