Nine confirms talks with SCA amid speculation of merger ahead of media reform
Nine Entertainment has moved to try and dampen media speculation about a potential merger between Nine Entertainment and Southern Cross Austereo.
The move comes amid media reports of recent negotiations speculating Nine would buy its counterpart’s radio assets ahead of changes to the media ownership rules that currently prevent the TV network merging with the whole of SCA.
In a statement to the ASX, Nine said: “From time to time over the past few years there have been discussions with Southern Cross Media on various commercial and broader business transactions.
“NEC and Southern Cross media have not reach any agreement on any transaction. Should an agreement be reached at any time, NEC will make an appropriate announcement to the market in accordance with its disclosure obligations.”
The Australian reports today that negotiations began some weeks ago for a possible deal where Nine would buy the SCA radio network, bypassing media ownership restrictions, with the remainder of the regional TV network’s assets being put into a holding company ahead of changes to the laws limiting the reach one media company can have to the Australian population.
It also noted due diligence was taking place at a time when cabinet is shortly expected to take up issues including the abolition of the reach rule and ending restrictions on how many types of media companies can own.
In a separate statement SCA said”as outlined by the company chairman Peter Bush in his address to shareholders at the company’s AGM on 29 October 2015, the board, management and the company’s advisers have been reviewing the company’s strategic options.
“However, the company has not received or made any merger proposal.”
This week Nine appointed Hugh Marks as its new CEO replacing David Gyngell. Marks is a former business partner of Grant Blackley the CEO of SCA with the pair co-owing major talent agency RGM Artists together.
Nine said this week Marks would seek to divest his stake in RGM Artists.
Nic Christensen
The plot thickens……
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Nine owns NBN.
NBN covers NNSW aggregated TV area.
Within the NBN area, SCA have radio stations on the Gold Coast, Coffs Harbour, Port Macquarie, Newcastle and Central Coast.
Currently, the number of owners of conventional media outlets is legislated to ensure diversity.
Nothing has changed with media legislation in the past twelve months.
Nine would be in great risk of having to divest radio stations in some of the aforementioned regional markets if no legislation was amended within the usual 12 month grace period that is usually given.
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