Australia media giants Fairfax, Nine set to merge
PUBLISHER Fairfax Media a n d Ni n e E n t e r t a i n ment announced plans to merge Thursday, creating an integrated Australian media giant across television, online video streaming, print, and digital.
Under the deal, Nine will effectively be the dominant partner, with its shareholders owning 51.1 percent of the combined entity and Fairfax s hare hol der s owning t he rest.
The new company will include Nine’s free-to-air television network, Fairfax’s radio interests and mastheads – including TheSydneyMorn- and TheAgein – and a suite of dig- ital assets.
It will be called Nine, with Fairfax ceasing to exist, drawing the curtain on a venerable brand that has been an Australian staple for more than 170 years.
It is the first deal under a controversial new media ownership law passed in Australia last September which removed restrictions – in place to protect diversity – that prevented companies from owning newspapers, radio and television stations in the same city.
Major players in the market had long pressed for change, arguing the rules were outdated and did not account for digital media platforms and new publishers like Google and Facebook and video streaming giants such as Netflix.
Like its international peers, Fairfax has had its profits squeezed as advertising and circulation slump in the digital age, and it has been slashing staff and costs in recent years.
Its board unanimously recommended the proposal, which is expected to deliver significant savings for both companies.
“The Fairfax board has carefully considered the proposed transaction and believes it represents compelling value for Fairfax shareholders,” Fairfax chairman Nick Falloon said.
A merger “unlocks the potential for significant value creation by combining the content, brands, audience reach and data across the respective businesses”, both companies said in a statement.
“The combination of our businesses and our people best positions us to deliver new opportunities and innovations for our shareholders, staff and all Australians in the years ahead,” added Nine chairman Peter Costello.
Another recent media deal in Australia saw US broadcasting giant CBS become the new owner of the country’s third-largest commercial television network, Ten, late last year.