By WATCHIRANONT THONGTEP
VGI Global Media’s revenue is targeted to be pushed up by 50 per cent to Bt3.1 billion in the fiscal year beginning in April with the consolidation of revenue from Master Ad.
“Nowadays, consumers spend more time outside their homes for commuting, shopping and dining. This trend can be seen both in Bangkok and the provinces. But more than 70 per cent of total out-of-home advertising spending is still pouring into Greater Bangkok, while the remaining 30 per cent goes upcountry,” Kavin Kanjanapas, executive chairman, said yesterday.
There is plenty of room to grow upcountry, where 84 per cent of the population resides, because of urbanisation and the full effect from the Asean Economic Community.
The country’s regions have also enjoyed faster economic growth per capita than Bangkok, he said.
Suparanan Tanviruch, chief financial officer, said the board of directors approved the acquisition of Master Ad’s shares and a tender offer for all of Master Ad’s securities for an expected Bt2.04 billion.
VGI holds 24.96 per cent of Master Ad. It wants to increase its holding to 37.42 per cent in May for Bt412.4 million.
“After having 37.42 per cent of Master Ad, which surpasses the 25-per-cent threshold, the company is required to launch a tender offer for the rest of the shares with an estimated Bt1.63 billion investment by the end of this year.
“The source of funds will be operating cash flow or credit facilities supported by financial institutions,” she said.
“Master Ad will be our spearhead for the company to expand its network upcountry,” chief executive officer Marut Arthakaivalvatee said.
Under Master Ad’s management are 178 mega-billboards, 215 networking billboards and 556 pieces of street furniture both in Bangkok and the provinces.
Kavin said that besides the outdoor-media business, VGI was also focusing on other out-of-home formats such as airports, digital media and on-ground activities.
“We are in talks with potential partners to expand further into those new areas. We expect to strike two or three deals this year,” he said.
VGI Global Media holds 20 per cent of Aero Media, which manages advertising and media services at 13 airports across the country that welcome more than 115 million travellers annually.
This media arm also manages advertisement via 342 LCD (liquid-crystal display) screens, 6,200 trolleys and 57 aerobridges.
To cash in on the digital transformation of the media business, the company will offer media and marketing services via its 5 million Rabbit card members in line with co-promotions with its 90 merchant partners.
For on-ground activities, the company will engage its customer base of 2 million active Rabbit card members and 16 million monthly e-mail-based customers.
Also in the out-of-home industry, Bangkok Metro Network, a subsidiary of Bangkok Expressway and Metro, aims to see growth of 12-15 per cent from Bt460 billion last year, fuelled by its advertising business in subway stations and expressways, retail rental space service and telecommunications service in subway stations.
The company hopes to list on the Stock Exchange of Thailand in two years.