Independent News & Media's transport advertising business in Australia, Buspak, has been one of the star's of the Irish group's Antipodean activities in recent years. But that might be coming to an end, with Buspak now coming under intense pressure from French group JC Decaux, whose worldwide activities include bus shelter advertising in Ireland.
Decaux has just been named as preferred tenderer for South Australia's metropolitan bus network, and is expected to take over 750 buses from Buspak, about 11 per cent of Buspak's total business.
And to make things worse, there is speculation that the loss of the South Australia contract may affect Buspak's contract in Sydney, which is up for renewal at the end of March. The Sydney contract accounts for a quarter of Buspak's fleet, and Decaux is thought to be preparing an aggressive bid. The loss of this contract would be a grievous blow.
That probably explains the current weakness in APN shares, which have dropped from A$4.60 to A$4.10 in the past week.
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