Private equity bid for Fairfax ‘as early as this week’

Private equity firm TPG Capital may attempt to buy Fairfax Media as early as this week, The Australian Financial Review’s Street Talk column is today predicting.

The AFR is itself owned by Fairfax Media.

The apparent move comes weeks after Fairfax signalled that it planned to spin off its growing Domain real estate arm into a separate entity which would be listed on the ASX, but still majority-owned by Fairfax, to secure better recognition from the markets of the value of Domain compared to the declining value of Fairfax’s traditional media assets.

As well as the AFR and Domain, Fairfax Media owns newspaper mastheads The Sydney Morning Herald and The Age as well as its regional newspapers.

However, according to the AFR article, TPG Capital is weighing whether to bid for the whole company now, rather than wait for Domain to be split out. It predicted: “An approach could now come as early as this week.”

The article also appears to be well informed on the position of Domain boss Antony Catalano, himself a shareholder in Fairfax. It writes: “It is surprising that no one from the TPG side of the fence has launched a charm offensive at the man known as The Cat.”

Over the past three months, Fairfax’s share price – listed as FXJ – has risen about 15%, taking it to a market capitalisation of $2.35bn.

The manoeuvring comes against a backdrop of government attempts to change the laws on media ownership, currently stalled in the Senate. If changed, it would remove barriers to companies owning media assets in multiple traditional channels in the same city, and spark a new wave of media consolidation.


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