Overseas Investment Office’s January decisions

27 February 2020

The Overseas Investment Office (OIO) has released summaries for decisions made in January 2020.

The OIO approved Shelley Bidco Pty Ltd (Shelley Bidco) to acquire up to 100% of QMS Media Ltd (QMS), an Australian outdoor media company with a focus on sport and outdoor advertising.

QMS owns 40% of New Zealand media company Mediaworks Investments Ltd (Mediaworks) – last year the OIO granted consent for QMS and MediaWorks to merge. Shelley Bidco is ultimately managed by Australian company Quadrant Private Equity.

Shelley Bidco needed consent from the OIO as it is acquiring significant business assets (worth more than $100 million) and interests in sensitive land through Mediaworks. This land includes residential land used for billboard advertising and radio telecommunications.

In New Zealand, Shelley Bidco intends to provide capital to expand the QMS outdoor business and the MediaWorks radio business, subject to agreement by Oaktree (the majority shareholder of Mediaworks). This is part of a larger international transaction by Shelley Bidco, with the New Zealand part of the acquisition estimated at around 20% of the total assets of QMS.

Shelley Bidco also demonstrated benefit to New Zealand through the fund’s 2018 investment in Darrell Lea/RJ’s Licorice.

The decision to approve consent was delegated to the OIO. This is because the application is under the benefit to New Zealand test, and the substantial and identifiable benefit test does not apply (the land does not include non-urban land of more than 5 hectares).

The OIO considered the benefits generated by the transaction in proportion to the size of the land and the nature of the interests being acquired.

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