MediaWorks faces buyout gossip

MediaWorks, the owner of television channel Three, says it has no comment on a report in an Australian newspaper that it may be about to be taken over by a billboard company.

The Australian said ASX-listed advertising company QMS Media was said to have put a takeover proposal to MediaWorks’ United States owner, Oaktree Capital, that was now under consideration.

Investment bank UBS had been acting as QMS Media’s adviser on a deal that would also see it take over cinema company Hoyts, according to the rumour, with a private-equity firm also involved.

‘‘Sources’’ differed on whether QMS wanted to acquire all of MediaWorks, or only parts of the business, the newspaper said.

MediaWorks owns about half New Zealand’s commercial radio stations, in addition to its TV arm.

Oaktree Capital is widely assumed to be willing to exit the business, which has steadied but is still loss-making.

A QMS spokeswoman said the company would not comment on what it described as ‘‘current media rumours and speculation’’.

‘‘It is aware of recent reports in the Australian media. If QMS has anything material to report to the market it will announce via the ASX,’’ she said.

QMS is valued at A$321 million (NZ$349 million) on the ASX and its main business is providing outdoor advertising in Australia and New Zealand, including at sports grounds.

Although relatively small, the company is profitable compared with most media firms and posted a net profit of A$18m and an operating profit of A$49m on sales of A$204m in the year to the end of June.

A New Zealand analyst estimated MediaWorks would be worth no more than print, radio and digital company NZME, which is valued at $122m on the NZX.

QMS chief executive Barclay Nettlefold said in August that it was looking for opportunities ‘‘that support our unique strengths in digital and outdoor and realise the untapped potential of sport, both locally and internationally’’.