NZ’s 2 main newspaper groups in merger talks

WELLINGTON: Facing declining revenues and changing reader habits, New Zealand’s two main newspaper groups announced yesterday that they were discussing a merger that could end decades of competition and result in hundreds of job losses.

Under the proposal, a single company would publish most of New Zealand’s metropolitan newspapers. That would mean readers from Auckland to Invercargill would end up reading many of the same stories on politics, business and sports.

If approved by regulators, the merger would combine the New Zealand newspapers, radio stations and websites owned by Fairfax Media Ltd and APN News & Media Ltd. Both companies, which are Australiabased, are seeking to divest their New Zealand assets and form them into a new, listed company.

APN publishes the country’s biggest daily newspaper, The New Zealand Herald, while Fairfax publishes the next largest dailies, The Dominion Post and The Press. The companies also own two of the largest news websites, stuff.co.nz and nzherald.co.nz.

The companies say their businesses are complementary and the proposed merger would allow them to improve offerings to readers and advertisers.

But unions and observers worry about the potential loss of jobs and diverse viewpoints.

The move represents the latest retrenchment in Australia and New Zealand, where many media companies are struggling to adjust to a rapidly changing landscape.

Gavin Ellis, a media commentator and former editor-in-chief of The New Zealand Herald, said the upside of the proposed merger was that it would allow the newspapers to survive longer than if the companies tried to go it alone.

The downside, he said, was the reduction in the variety and voices of journalists and opinion columnists.

The two companies have a combined New Zealand workforce of about 3,000. Ellis said there could potentially be hundreds of job losses as the groups eliminated duplication in everything from political coverage to sales.

To complete the merger, APN plans to separate its New Zealand holdings and list them on the New Zealand and Australian stock exchanges under the name NZME. Fairfax would then fold its New Zealand assets into NZME.

Ciaran Davis, the chief executive of APN, said the two companies had signed a memorandum of understanding.

The merger will need approval from New Zealand’s Commerce Commission, which is tasked with ensuring business monopolies don’t develop.