One of the world’s biggest outdoor advertisers has moved into Ukraine’s and Russia’s large-format advertising industries by consolidating forces with a major regional big board outfit in a multimillion-dollar merger aimed at staking out its share in these potentially lucrative growth markets.
French big board and street furniture giant JCDecaux announced Sept. 7 that it had entered the Ukrainian and Russian outdoor advertising markets through the creation of a joint venture called BigBoard BV with Czech-based BigBoard Group SA, in which BigBoard Group SA will have a 60 percent interest, and the family-run JCDecaux will have the remaining 40 percent.
According to JCDecaux, it is the number one outdoor advertising company in Europe and the Asia-Pacific, and number two worldwide.
In addition to large format billboards, the company provides street furniture, such as bus shelters, freestanding units, public toilets and kiosks, and operates more than 700,000 advertising displays across 3,500 cities in 45 countries around the world. The company reported more than 1.7 billion euros ($2.1 billion) in revenues in 2005 and nearly 950 million euros ($1.2 billion) in revenues in the first half of 2006.
Founded in 1992, BigBoard Group SA has been operating on the Ukrainian market for the last 13 years. In addition to the Czech Republic, Ukraine and Russia, BigBoard also operates in Slovakia and Belarus.
JCDecaux said in its Sept. 7 statement that BigBoard Group SA is the leading outdoor advertising company in Ukraine, with “more than 7,400 faces in 32 cities and a market share of approximately 20 percent.”
In Russia, BigBoard operates more than 3,000 advertising faces, and maintains a presence in eight out of 12 Russian cities with more than 1 million inhabitants.
JCDecaux said that BigBoard Group’s combined Ukrainian-Russian operations generated around $30 million in advertising revenues last year.
“Russia and Ukraine are currently two advertising markets where it is possible to achieve more than 10 percent growth year-on-year,” JCDecaux quoted its co-CEO Jean-Francois Decaux as saying.
“Our joint venture with BigBoard Group SA will enhance our growth profile in the fast growing East European advertising markets, where JCDecaux has already achieved market leadership in the Czech Republic, Slovakia, Croatia, Serbia,” he said.
Under the 60-40 deal, JCDecaux said that BigBoard Group SA is contributing its existing outdoor advertising network in Ukraine and Russia, while JCDecaux is making “a cash injection, which will … allow it to participate in the consolidation of the outdoor advertising market in both countries.”