6 buyers tipped for Mediaworks
Bank managing sale confirms ‘a lot’ of interest — Oz parties look most likely
The future of the Mediaworks TV arm remains uncertain, with the broadcaster still unable to lock down a buyer months after putting the business on the market.
Mediaworks, owned by equity fund Oaktree and billboard company QMS, first announced its TV arm was for sale in October last year and appointed investment bank UBS to manage the sale process.
UBS is understood to have met with numerous interested parties, but a Mediaworks spokesperson yesterday told the Herald the “process is still ongoing”.
“We’ve had a lot of interest and UBS is doing a lot of work to hopefully reach a successful conclusion. We will update when we are able to,” the spokesperson said.
The Herald understands that as many as six parties have expressed interest in the business, but the level of that interest remains unclear.
No organisation has been linked with Mediaworks more consistently than Australian broadcaster Seven West-media, whose CEO last year alluded to a potential move even before the company was put on the market.
At a staff meeting last year, Seven chief executive James Warburton is understood to have spitballed an idea that would see Australian and US content syndicated across this side of the ditch.
The Australian newspaper did, however, report near the end of last year that it could prove difficult for Warburton to justify the purchase to Seven shareholders and that a sale seemed “doubtful”.
Other Australian broadcasters rumoured to a be casting a cursory glance at the business include CBS, NBC Universal and Nine Entertainment, but it’s still unclear how much appetite these organisations have to take on the loss-making arm of the business.
NBC Universal has collaborated with Mediaworks on the launch and broadcast of reality channel Bravo TV, while Nine Entertainment currently owns Stuff.
television
The Herald has contacted Seven, Nine and NBC Universal for comment.
Australian broadcasters have been tipped as likeliest suitors on account of their ability to reduce costs by syndicating their content across both sides at the ditch.
No matter which way you look at it, however, taking on the Mediaworks TV arm will be risky business.
Last year, a banking analyst estimated that the Mediaworks television arm was losing as much as $10-15 million a year in earnings before interest, tax, depreciation and amortisation (ebitda).
Based on those figures, Mediaworks will be hoping to get a deal across the line or risk burning through the $26m cash injection earned from the sale of its Auckland headquarters.
If anything, the relatively simple sale of the building viewed alongside the uncertainty plaguing the TV business provides a stark reminder that static edifices remain the best way to make money in Auckland.