By Dominic Chopping
Norwegian media group Schibsted will be split into two parts, with its news media operations taken over by its largest shareholder in a deal worth 6.2 billion Norwegian kroner ($568.8 million), it said Monday.
Under the plans, Schibsted’s current news media business would be carved out into a separate company and then sold to and privately held by Tinius Trust, with Schibsted’s remaining marketplaces businesses remaining as a publicly listed company on the Oslo Stock Exchange.
“After an extensive financial and strategic analysis of the value creation potential of Schibsted’s current core businesses, News Media and Nordic Marketplaces, we have concluded that both have a potential as stand-alone companies up and beyond what they can achieve in the current company structure,” says Schibsted Deputy Chairman Rune Bjerke.
Schibsted’s news media business includes news outlets VG, Aftenposten, Aftonbladet, Svenska Dagbladet, as well as stakes in Polaris, NTB, TT Nyhetsbyran, and digital niche products such as E24. The business had revenue of NOK7.55 billion in the last twelve months.
Schibsted said it intends to return the cash proceeds from the transaction to its shareholders after its close, which is expected in the first half of 2024.
The Tinius Trust currently controls around 26.3% of Schibsted’s total issued shares.
Write to Dominic Chopping at [email protected]
By Dominic Chopping
Norwegian media group Schibsted will be split into two companies, with its main news-media operations taken over by its largest shareholder in a deal worth 6.2 billion Norwegian kroner ($568.8 million), it said Monday.
Under the plans, Schibsted’s current news-media business would be carved out into a separate company and then sold to and privately held by Tinius Trust. Schibsted’s marketplaces business would remain as a publicly listed company on the Oslo Stock Exchange.
Cash proceeds from the deal will be returned to shareholders after completion, which is expected in the first half of 2024, it said.
“After an extensive financial and strategic analysis of the value creation potential of Schibsted’s current core businesses, News Media and Nordic Marketplaces, we have concluded that both have a potential as stand-alone companies up and beyond what they can achieve in the current company structure,” says Schibsted Deputy Chairman Rune Bjerke.
The news-media operations has traditionally seen higher earnings volatility than the marketplaces business. As a result, the deal should improve the earnings visibility of the remaining Schibsted business and reduce its exposure to advertising revenue, UBS analyst Jo Barnet-Lamb said in a note.
Schibsted’s news-media business includes several Scandinavian news outlets. Its NOK6.2 billion sales price compares to Barnet-Lamb’s NOK4.7 billion valuation of the business.
Schibsted currently operates a dual-class share structure, which it has agreed to remove as part of the deal. Class A shareholders will be compensated for the loss of the premium at which these shares trade compared to B shares.
“The proposed collapse of the dual-share structure should migrate all trading volume through one single line, which would improve the liquidity of the group. This has been an issue historically for some investors, in our view.” Barnet-Lamb added.
The Tinius Trust currently controls around 26.3% of Schibsted’s shares and it will retain that stake in the remaining listed Schibsted company.
Schibsted spun off its Adevinta online classified-advertising business in 2019. Last month, it agreed to sell 60% of its 28.1% stake in Adevinta to a consortium led by Permira and Blackstone for NOK24 billion, with its remaining Adevinta shares going into an indirect parent company of the consortium.
At 0915 GMT, the company’s more widely traded A shares were 13% higher at NOK308.50 while the B shares were 12% higher at NOK292.60.
Write to Dominic Chopping at [email protected]
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