Hell­man & Fried­man of­fers as much as A$2.87b for Aussie me­dia com­pany

New Straits Times - - Business -

AUS­TRALIA’S old­est news­pa­per pub­lisher Fair­fax Me­dia Ltd yes­ter­day said it has re­ceived a takeover bid worth as much as A$2.87 bil­lion ($2.13 bil­lion) from a sec­ond United States pri­vate eq­uity firm, send­ing its shares sharply higher.

The sur­prise of­fer from buy­out firm Hell­man & Fried­man val­ues Fair­fax at A$1.225 to A$1.25 a share, com­pared to an ear­lier of­fer from TPG Cap­i­tal Man­age­ment and On­tario Teach­ers’ Pen­sion Plan Board of A$1.20 a share.

In­vestors wel­comed the prospect of a bid­ding war for the pub­lisher of the Syd­ney Morn­ing Her­ald and the Aus­tralian Fi­nan­cial Re­view news­pa­pers, al­though law­mak­ers have ex­pressed con­cern over the pos­si­ble im­pact on lo­cal jour­nal­ism.

“It is al­ways good that there is a bit more com­pet­i­tive ten­sion,” said Suhas Nayak, a port­fo­lio man­ager at Al­lan Gray, which holds Fair­fax shares.

Fair­fax shares leapt 6.7 per cent to A$1.24 by mid-ses­sion on Thurs­day, in line with Hell­man’s in­dica­tive of­fer range. The broader share mar­ket was down 1.2 per cent.

The pub­lisher said it would al­low both suit­ors to con­duct due dili­gence “to ex­plore whether a po­ten­tial whole of com­pany pro­posal is avail­able”.

The chair­man emer­i­tus of Hell­man, Brian Pow­ers, was the chair­man of Fair­fax from 1999 to 2002.

TPG said it wel­comed the op­por­tu­nity to con­duct due dili­gence­but de­clined to com­ment on the Hell­man bid.

An­a­lysts ex­pect any pri­vate eq­uity buyer to keep Do­main and metropoli­tan mast­heads and dump non-core re­gional news, ra­dio and stream­ing video busi­nesses, rais­ing fears for the fu­ture of pub­lic in­ter­est jour­nal­ism in a mar­ket al­ready dom­i­nated by a hand­ful of me­dia pro­pri­etors.


Fair­fax Me­dia, the pub­lisher of the Syd­ney Morn­ing Her­ald, saw shares leap to A$1.24 yes­ter­day in line with Hell­man’s in­dica­tive of­fer range.

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