JUNE 2016

OOH and M&A – A Look AheadMark BoidmanManaging Director, Peter J. Solomon Company

@MBoidman

1

Providing Advice to Clients for Over 27 Years

Assignments of PJSC and / or Mark Boidman.

Mergers & Acquisitions

Advisory

Restructuring / Recapitalization

Advisory

Advisor on Public and Private Capital

Raising

Advisor to Boards of Directors PJSC

Completed over $180 billion of M&A, restructuring and financing advisory assignments

PJSC is at the forefront of media and technology

Assignments in OOH / DOOH / Digital Signage / Retail Tech have included*:

*

2

Investment by Natixis Provides Access to Global M&A and Financing PlatformIn February 2016, Natixis announced an agreement for a majority investment in Peter J. Solomon Company to serve as its U.S. investment banking platform

Global Platform

Capital Markets Expertise

Debt Capital Markets Strategic Equity Transactions

Americas EMEA Asia Pacific 2,600 Employees across all platforms

Corporate & Investment Banking offices in New York, Los Angeles, Houston, Montréal, Bogotá, Buenos Aires, Lima, Mexico City and São Paulo

Strong track record in providing financing solutions to private equity clients

13,200 Employees across all platforms

Corporate & Investment Banking offices in London, Madrid, Milan, Frankfurt and Dubai along with corporate subsidiaries in Moscow and Frankfurt

Paris houses all major divisions, including capital markets and asset management

In 2015, acquired Leonardo & Co., an M&A advisory firm in France, and 360 Corporate Finance, a financial advisory firm in Spain

500 Employees across all platforms

Corporate & Investment Banking offices in 12 countries organized around Hong Kong regional center (Australia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Singapore, Taiwan, Thailand and Vietnam)

High performing asset management business with over $20bn AUM

Assists clients in raising capital for acquisitions, leveraged buyouts, restructurings and recapitalizations

Structure, arrange and underwrite: – First lien and second lien loans– Bridge facilities– High yield

Significant cross border transaction experience complemented by multi-currency funding capabilities

Syndication and distribution capabilities to support corporate and financial sponsor clients

Assist clients in optimizing listed equity stakes Customized structured solutions to facilitate accelerated share

repurchases Financing and risk management for equity positions, including

hedging strategies, margin loans and equity swaps Global trading capabilities Ability to structure and execute jumbo transactions

First lien and second lien loans

Bridge facilities

High yield bonds

Investment grade bonds

PRIVATE AND CONFIDENTIAL

3

POS

Source: Company financials and websites, MagnaGlobal, Outdoor Advertising Association of America, Digital Place-Based Advertising Association, FactSet and Wall Street research.

Local

Airport / Aerial / Water

Transit / Taxi

Stadium / Arena

Movie Theater

BillboardNational

Retail

Point of Care

Latin America

Background Music

Grocery

Content

Agency

Gas Station

Shopping MallHotel

Office / Elevator

Health / Personal Care

Bar / Club

Restaurant Solutions / Kiosk / Other

Smart Cities

What We Cover in OOH / DOOH / Digital Signage / POS the Americas

Canada

4

What We Cover in OOH / DOOH / Digital Signage / POS (Europe + Asia)

Solutions / Kiosk / Other

France

Spain

Netherlands

Belgium

Germany

Scandinavia

Poland

Italy

Eastern Europe

Turkey

Billboard / Outdoor Digital Out of Home

U.K.

Asia

5

Defining the Global Intelligent Visual Communications Industry2015 – 2019

Retail Technology$27B going to $40B – $45B

Digital Signage$16B going to

$22B

DOOH$11B going

to $19B

Out of Home Media

$38B going to $46B

PRIVATE AND CONFIDENTIAL

6

Executive Summary

Stability in macro fundamentals

Technology as a friend and penetration of digital

Ubiquity of mobile

Robust OOH Industry Outlook Driven By

OOH Industry Challenges

Defending / taking share of advertising spend

Measurability and demonstrating clear ROI for advertising clients

Ease of buying - buyers and sellers resisting change

PRIVATE AND CONFIDENTIAL

7

Thailand

Estonia / Latvia / Lithuania

U.K. & Ireland

Poland

Global Out-of-Home Footprint

Source: FEPE, company websites.

USA

China

Canada

France

Turkey

Brazil

Chile

Australia

Spain

`

Netherlands

Italy

Scandinavia

Mexico

Germany

Switzerland

Belgium

PRIVATE AND CONFIDENTIAL

8

Global OOH Spending

Global OOH Advertising Revenue Global DOOH Advertising Revenue

Global DOOH as a Share of Total OOH Revenue 2019 Estimated DOOH Penetration in Digital Markets

Source: Peter J. Solomon Company Wall Street research.

$36 $38 $40 $42 $44 $46 $49

0

10

20

30

40

$50

2014A 2015A 2016E 2017E 2018E 2019E 2020E

$10 $11

$13 $14

$16 $19

$21

0

5

10

15

20

$25

2014A 2015A 2016E 2017E 2018E 2019E 2020E

27% 29% 32% 34%

37% 40%

44%

0%

10%

20%

30%

40%

50%

2014A 2015A 2016E 2017E 2018E 2019E 2020E

60% 58% 56% 54%

42% 40%

0%

15%

30%

45%

60%

75%

Singapore US HongKong

UK China GlobalAverage

(Amount in Billions) (Amount in Billions)

PRIVATE AND CONFIDENTIAL

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Global OOH Spending

2015 Global OOH Revenue By Category

Source: Peter J. Solomon Company Wall Street research.

45%

28%

18%

8%

Billboard & Large Format

Other

Transportation

Urban Furniture

2016 Estimated OOH Main Markets Spending

$9.0

$7.5 $7.2

$1.7 $1.4 $1.4 $1.2 $0.9 $0.6 $0.6 $0.4 $0.4 $0.3 0

2

4

6

8

$10

China US Japan UK France SouthKorea

Germany Brazil Australia Canada India Spain Mexico

(Amount in Billions)

PRIVATE AND CONFIDENTIAL

10

15%

8% 6% 5% 5%

4% 3% 3% 3% 3% 3% 2% 1%

0%

4%

8%

12%

16%

20%

Brazil China India Australia US UK Mexico Japan Spain Canada Germany SouthKorea

France

Global OOH Spending2016 Estimated OOH Share of Total Advertising in Main Markets

Source: Peter J. Solomon Company Wall Street research.

2016 Estimated OOH Growth in Main Markets

20% 17%

12% 12%

8% 7% 7% 6% 6% 6% 6% 5% 4%

--

5%

10%

15%

20%

25%

Japan SouthKorea

France China UK Mexico Spain Australia Brazil Canada Germany India US

11

$0.3

$1.3 $1.4

$3.3 $1.5

$0.1

$3.6

$2.8

$1.5 $1.4

$1.2

$0.9

$0.6

$0.3 $0.2 $0.2 $0.2 $0.2 $0.2 $0.2 $0.1

JCDecaux CCO OUTFRONT Lamar Focus Ströer Exterion APG|SGA Metrobus Clear Media Intersection APN oOh! Media Asiaray Russ

North America International

2015 Outdoor Revenues

Source: Peter J. Solomon Company Wall Street research.

(Amounts in Billions)

PRIVATE AND CONFIDENTIAL

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Global Advertising SpendTop 10 Global OOH Advertisers Excluding Asia

Source: Peter J. Solomon Company Wall Street research, OAAA, Outsmart.

Top 15 Global Advertisers in 2015

(Amount in Millions)

$15.0

$12.2

$9.1 $8.3

$5.9 $5.5 $5.1 $4.3 $4.0 $3.2 $3.1 $3.0 $2.7 $2.7 $2.6

Microsoft Google Amazon P&G Comcast Expedia GM Ford Coca-Cola Nike AmericanExpress

Priceline Verizon JP Morgan WaltDisney

(Amount in Billions)

$105

$59 $51 $48 $44 $44

$36 $35 $28 $28

McDonalds Apple Warner BrosPictures

Verizon British SkyBroadcasting

Coca-Cola 20th CenturyFox

Metro PCS Geico Talktalk

PRIVATE AND CONFIDENTIAL

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Agency buying structure

Municipalities looking for dollars

More sophisticated property owners aware of values to be extracted from OOH operators

Out of Home Advertising Investment Thesis

Source: Wall Street Research.

Considerations

Near Term Growth Strategy

Digitization / Mobile

Continued conversion into digital billboard displays

Location-based marketing and mobile ad opportunities

Adopt audience measurement and buying techniques providing accountability

Data to supplement existing OOH ratings, e.g., beacon or other tech

Ad Exchanges / Programmatic Buying

14

Current Agency Buying Structure Remains Challenge

Software platforms to OOH industry are threat to selling proposition of specialists “buying this media is hard and requires years of experience”

– Importance of data + software that increases access and reduces fragmentation; traditional OOH specialist forced to adapt or become extinct

The better the relationship = better sales. Hard to get friendly with automated platform

Sellers looking to increase demand + reduce friction in selling their media (while maintaining primary control)

– Software as the solution…not specialists

Buyers resisting changes to planning and buying OOH

Sellers have over years invested in these relationships

The industry has to adapt or stall OOH industry sales

15

Defending / Taking Share of Global Advertising Spend

Source: Wall Street Research.

More digital billboards replace non-digital signage, with more faces (debatable) More DPB networks getting deployed (most are not making money)

– Not taking share from other ad buckets, + with more faces in the marketplace, potentially only taking share from each other

Use technology to be/feel more "digital" so that OOH can attract dollars that today go into other ad buckets Approach mobile + OOH as one product to change the face of OOH attribution and put

OOH higher up in the planning as marketing mix is being determined

Potential Problem: $40B OOH ad bucket may not grow enough to offset supply

Potential Solution: “Blur the Buckets” leads to more value and better pricing

16

How many views does display get?

Impressions

New vs. Repeat

How long do they stand in front of

the display?

Duration

How frequently do people view

display?

Frequency

What % of people are new? What % have I

seen before?

OOHEnhancing Value of

Use Technology to Measure and as Bridge to Attribution

17

Attribution and EngagementMeasure the percentage of people who were exposed to or engaged with the ads and subsequently visited a store and / or made a purchase

Impressions Visit

In-Store Analytics• Storefront Conversion

• Visit Duration• Visit Frequency

• Interaction / Engagement

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Total Global Ad Spending by Category

Source: Peter J. Solomon Company Wall Street research.Note: Total media ad spending worldwide in 2015 of $515 billion and growing to $610 billion in 2018.* Includes both linear and non-linear television. Non-linear includes non-traditional television such as Netflix, Hulu and other over-the-top programming.

($ in Billions)

3-YrCompoundGrowth Rate(’15-’18):

Traditional Media Category

OOH only traditional medium expected to show real growth

Mobile and online video = the leading advertising categories over the next few years

2015 2018

*

191

104

47

66

38 34 33

207

115 114

60 44

36 30

--

50

100

150

200

250

Television Desktop Internet Mobile Internet Newspapers OOH Media Radio Magazines

2.8% 3.7% 34.0% (2.9%) 5.0% 2.5% (3.1%)

19

Select Media Channels Trading Performance

Source: Capital IQ as of May 25, 2016.

EV / 2016E EBITDA12.5 x

11.7 x

8.6 x 7.7 x

5.7 x

Digital Media OOH Media TV / Radio Broadcasting Retail Tech / DigitalSignage

Newspapers

PRIVATE AND CONFIDENTIAL

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13.1 x

11.5 x 10.9 x

12.0 x

EV / 2016E EBITDA

Source: Capital IQ as of May 25, 2016.

Out of Home Comparable Companies

Potential unlocked “REIT” value could increase multiple to 14.0x-16.0x in current

low interest rate environment

21

PRIVATE AND CONFIDENTIAL

The Smart Cities Opportunity For Digital Signage / DOOH is Huge…

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Smart Cities Opportunity

Source: Frost and Sullivan, IHS Technology research and MIT Technology Review.

Smart cities represent a $1.5 trillion market opportunity in energy, transportation, infrastructure and governance

Currently 28 “smart cities” spread throughout Europe, North America and Asia Pacific

Additional 102 planned and in-progress smart cities, with 88 expected to be successfully completed by 2025

21 2428

3339

45

88

0

20

40

60

80

100

2013 2014 2015 2016E 2017E 2018E 2025E

Num

ber o

f Sm

art C

ities

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Participants in the Smart City MarketOpportunity for OOH operators to participate in potential massive market

Managed Service ProvidersProduct Vendors Integrators Network Service 

Providers

Provide smart meters and distribution devices (e.g., automated switches, voltage regulators) that operate as main nodes of connectivity

Provide integrated turnkey solutions that package together various smart city capabilities and technologies

Offer collaborative networks and enterprise working solutions that connect people, assets and systems by leveraging M2M capabilities

Offer around-the-clock monitoring, management and compliance services and on-site consulting for smart city solution providers