VIENNA (dpa-AFX) - UBM plc (UBM.L, UBMJF.PK) announced that PR Newswire, a UBM company, has acquired the outstanding 50% share in its Canada Newswire, or CNW, business from the PA Group Limited for cash consideration of 30.1 million pounds. Following the transaction, UBM will retain its 17% interest in the PA Group. The current management team of CNW will remain in place.
UBM said it has fully consolidated CNW's results reflecting its direct and indirect ownership of 58.5%. The acquisition will not directly affect reported consolidated revenue or operating income. The transaction will eliminate the non-controlling interest in CNW profit which in 2011 was 2.3 million pounds.
Full ownership will enable PR Newswire to implement an aligned commercial, product development and infrastructure strategy across its North American business. Alignment is expected to result in incremental revenues in Canada. Cost savings from the integration of the businesses and technology platform are expected to be broadly offset by restructuring costs in the balance of 2012 and 2013. The return on this investment is expected to exceed UBM's cost of capital in 2013 and subsequent years.
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