Lamar Advertising Company is no longer pursuing a $300 million initial public offering through a special subsidiary it created more than a year ago to buy a digitally focused advertising company.
In a filing with the Securities and Exchange Commission, Lamar said it was withdrawing its registration from the subsidiary, Lamar Partnering Corporation, “because it no longer wishes to conduct a public offering of securities at this time.”
The filing said the SEC never formally approved the subsidiary’s registration, so no shares were ever sold. Lamar asked the SEC to credit the fees it paid for the registration “for future use.”
In April 2021, the Baton Rouge-based advertising giant first registered Lamar Partnering Corporation as a special purpose acquisition company, or SPAC. Also known as a “blank check” entity, SPACs are shell companies formed to raise capital for an acquisition or a merger. Lamar Partnering Corporation was registered in the Cayman Islands, a known tax haven.
Lamar’s proposed IPO was for $300 million, or 30 million shares at $10 each.
Lamar didn’t seem to have a specific company in mind when it created the SPAC. Filings said the company was looking for a firm at the “intersection of out-of-home, technology, and communications” and with “demonstrated growth potential.” Filings indicate Lamar was primarily interested in a company with expertise in transit and airport advertising, international outdoor displays and digital advertising.
SPACs shot up in popularity in 2020 and 2021, but they’ve fizzled out this year amid economic headwinds and the potential of tighter regulatory scrutiny.
SPAC IPO transactions escalated from 59 in 2019 to 613 last year, according to SPACInsider. So far, only 70 SPAC IPOs have taken place in 2022. In response to the explosion, the SEC proposed new rules that would require more regulatory disclosures from SPACs.
Lamar officials said the SPAC market “is in a far different place” than when Lamar Partnering Corporation was registered in 2021.
“As a result, we no longer anticipate that LPC will be undertaking a public offering of shares,” Buster Kantrow, Lamar’s executive vice president of business development and investor relations director, said in an email.
When asked about the fate of its SPAC, Kantrow said Lamar doesn’t foresee the Lamar Partnering Corporation “being an active company.”
Ross Reilly, a vice president at Lamar Advertising, was serving as the SPAC’s chief executive. He is the son of Lamar Executive Chairman Kevin Reilly Jr. and the nephew of Lamar President and CEO Sean Reilly.
Lamar operates more than 350,000 billboard, transit and airport advertising displays across the US and Canada. More than 3,600 of those slots are digital.