XTD acquires oOh!media’s mega-health network, launches separate out-of-home media venture
In addition to the acquisition, XTD has launched out-of-home media sales company MOTIO Pty Ltd.
Digital transit media company XTD (ASX: XTD) has agreed to make an all-cash payment of $300,000 for the acquisition of oOh!media’s (ASX: OML) health network which operates in over 50 “mega” dental and medical facilities Australia-wide.
Under the terms of the acquisition, oOh!media will assign XTD exclusive media rights to the digital network it holds with medical centre management company Idameneo (No 123) Pty Ltd for an initial five year term commencing in June.
Automatic renewal for a further two years and additional three years thereafter will be by mutual agreement.
The acquisition will allow XTD to acquire assets including screens, players and associated equipment from oOh!media for the cash consideration value.
Since August, XTD has been working on its vision to create a customer-facing team which enables potential partner networks to benefit from its experience in the ‘place based’ out-of-home media sector.
New company launch
The acquisition of oOh!media coincides with XTD’s launch of data-led, out-of-home media sales company Motio Pty Ltd, which will begin operating in May.
Data led networks utilise first party, anonymised customer data to target specific audience segments, which then allow brands to place advertising at the right time and location to target the same.
Managing director Adam Cadwallader said the investment in oOh!media and the launch of Motio is opportunistic for XTD.
“We are acquiring a high quality, digital out-of-home network with Australia’s leading medical centre provider at a modest operating cost,” he said.
“Each [medical and dental] centre has provided critical input into the development of the network [and it] provides an ideal launch pad for Motio.”
Centralised access
oOh!media’s health network enables large-scale medical and dental facilities to have direct, centralised access to communicate important messages in an instant to customers.
Mr Cadwallader said the network provides a “true, usable amenity” to the centres alongside rich content which XTD will continue to develop.
“Entertaining and engaging people in waiting rooms will enable brands to engage consumers with more than just advertising, unlocking the moment of maximum influence at the intersection of time, place and intent,” he said.
“This acquisition will allow us to expand our business within a sector which is experiencing a spike in clientele at present and is central to [our] strategy of owning networks in out-of-home and advertising technology.”
Business opportunities
Last month, XTD confirmed it was well-positioned to explore new business opportunities on the back of strong financial results for the second half of 2019.
The company posted earnings before interest, tax, depreciation and amortisation of $439,350 and a net profit of $214,376, representing a 153% and 121% respective increase on the previous corresponding period.
Mr Cadwallader said the board of directors had been prompt in evaluating a number of opportunities for investment during the half-year, including the acquisition of diversified media and marketing company Adline Media which was funded through a combination of cash and securities.
“Adline has strengthened and systemised the business of social sport, creating new and diversified pathways with media, software and supply,” he said.
“We have begun the year shaping and refining the business including the development of its footprint, increasing its reach and data capability in the community sport and leisure sector and deepening its presence in the advertising sales market.”
At mid-morning, shares in XTD were trading 26.92% higher at $0.033.