Baton Rouge-based advertising giant Lamar Advertising Co. has acquired the billboard operations of Fairway Outdoor Advertising for $418.5 million.
The all-cash deal adds more than 8,500 billboard faces, including more than 135 digital displays, to Lamar's existing portfolio of more than 348,000 displays across North America.
It also will put Lamar in five new markets: Greenville/Spartanburg, South Carolina; Raleigh-Durham, North Carolina; Greensboro/Winston-Salem, North Carolina; Athens Georgia; and La Crosse, Wisconsin.
Lamar bought the operations from Chicago private equity firm GTCR LLC, which in 2015 partnered with Adams Outdoor Advertising to buy Fairway Media Group.
Lamar, a publicly-traded company, had looked at the properties about four years ago, but was outbid by the private equity firm, CEO Sean Reilly said in a conference call with investors. After running the operations for a few years, the firm decided to do an auction, and Lamar acquired some of the assets offered, he said.
"GTCR has done an excellent job operating these assets since acquiring them in early 2015, and we are confident that we can build upon their success," Reilly said in a statement. "Given our familiarity with the Southeast and the upper Midwest, we anticipate a seamless transition."
The deal is expected to add $70 million in revenues in 2019, Lamar said.
Lamar is structured as a real estate investment trust, allowing it to avoid paying corporate income tax on profits as long as it distributes at least 90 percent of earnings to shareholders. The company made the move several years ago.
Founded in 1902, the firm has made a series of acquisitions in recent years, including the purchase of Steen Outdoor Advertising last year.
The company makes about $100 million in acquisitions a year for billboards, ground leases, advertising contracts and permits, Bloomberg reported.
The company also said it will increase its quarterly distributions to stockholders in 2019 by 5.2 percent.