Share in Fairfax Media have today hit their highest point in more than five years as speculation continues to grow that private equity company TPG Capital is poised to launch a takeover bid.
The valuation of the company – listed on the ASX as FXJ – has risen by 17% in the last month and by about 10% in the last week alone.
Earlier today the FXJ share price topped $1.10 for the first time since May 2011, giving it a market capitalisation of $2.5bn.
Fairfax’s growing share price since 2012 | Source: Google Finance
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On Monday’s Fairfax’s business newspaper the Australian Financial Review predicted that TPG could launch a bid “as early as this week“. The AFR today reported that TPG had begun buying shares in the company.
If a takeover bid gets underway, it would be as an alternative move to Fairfax’s own plans to float its realestate site Domain as a separate listing on the ASX in an attempt to unlock greater value. By contrast, the News Corp- aligned REA Group, which is separately listed, has a market capitalisation of $7.85bn
Fairfax’s non-growth media assets include the Sydney Morning Herald, The Age and regional newspapers. Fairfax also owns stakes in streaming service Stan and talk radio company Macquarie Media.