(Adds details about company, background)
March 27 CBS Outdoor Americas Inc's
said it priced its initial public offering at $28 per share,
valuing the outdoor advertising company at about $3.36 billion.
CBS Outdoor, part of media conglomerate CBS Corp,
will raise about $560 million from the offering of 20 million
shares at that price, which is at the high-end of its planned
$26 and $28 range.
The company's shares will start trading on Friday on the New
York Stock Exchange under the symbol "CBSO."
CBS, which will reduce its stake to 83 percent after the
offering, plans to convert CBS Outdoor into a real estate
investment trust (REIT).
As a REIT, it can avoid paying corporate-level income taxes
if it distributes at least 90 percent of its taxable income to
shareholders in the form of dividends.
CBS Outdoor had about 330,000 displays in the United States
and about 26,200 displays across Canada and Latin America as of
Dec. 31. The company has displays in some of the most heavily
trafficked locations such as the Bay Bridge in San Francisco,
Sunset Boulevard in Los Angeles and Grand Central Station and
Times Square in New York City.
The New York-based company counts Apple Inc,
McDonald's Corp, Sony Corp and Verizon
Communications Inc among its major customers.
Outdoor advertising companies have been converting their
traditional billboards to digital billboards as it allows them
to run multiple ads on each display. As of Dec. 31, 2013, CBS
Outdoor had 373 digital billboard displays in the United States.
CBS has moved to diversify its revenue away from
advertising, in part by selling shows to subscription video
on-demand services such as Netflix Inc and Hulu Plus.
"We've changed from a company that was 70 percent dependent on
advertising to a company that's down to close to only 50 percent
dependent on advertising," Chief Executive Officer Leslie
Moonves said at a Morgan Stanley conference earlier this month.
CBS Outdoor, which competes with Clear Channel Outdoor
Holdings Inc and Lamar Advertising Co, said net
income rose 27 percent to $143.5 million on revenue of $1.29
billion for the year ended 2013.
Goldman Sachs & Co, BofA Merrill Lynch, J.P. Morgan and
Morgan Stanley are the lead underwriters of the offering.
(Reporting by Avik Das and Narottam Medhora in Bangalore;
Editing by Bernard Orr)