Plan B Media Public Company Limited (SET: PLANB) has announced this morning that the company has resolved to acquire two out-of-home media businesses from Aqua Corporation Public Company Limited (SET: AQUA) with a total purchasing price of approximately THB 2,882 million. PLANB will issue a capital increase through a private placement at a price of THB7.22 per share, totaling 606 million baht.
The share price of PLANB finished 3% lower on Wednesday at THB7.90 per share.
Despite the selloff in the market, Maybank Securities (Thailand) (MST) has a positive view on this acquisition, seeing small dilution to the share price with higher potential return from the deal. The investment is in line with MST’s investment idea that PLANB will step up as a leader in OOH business after the Covid-19 situation eases and will mark a recovery of Thailand’s OOH industry.
The deal will increase PLANB’s revenue capacity by approximately 20% to 9,000 million baht, which is ahead of the second ranking OOH business by a fold. The company will start a revenue recognition in 1Q22.
MST expected the EPS dilution from this deal will be only 2% as PLANB recorded more than 2,000 million baht of EBITDA, while the deal would cost 2,294 million baht to its expenses, which is why MST deemed this deal positive when compared between EPS dilution and the potential of increasing revenue capacity by 20%.
In addition, MST gave a “BUY” recommendation on PLANB with a target price at THB9.45 per share.