By 9News,April Glover
Copyright 9news
Seven West Media and radio giant Southern Cross Media have flagged plans to merge, with Kerry Stokes set to stand down as chair of the media group.
The deal, if approved by shareholders and the corporate watchdog, would see some of Australia’s biggest digital, radio, newspaper and broadcast media properties under the same roof as part of a more than $400 million agreement.
Seven West Media owns and operates 7News, 7news.com.au, The West Australian, The Sunday Times and The Nightly, along with Community Newspaper Group, which publishes over 20 newspapers in WA.
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Southern Cross owns 96 radio stations across FM, AM and DAB+ radio, including the Triple M and Hit brands.
Seven West Media and Southern Cross anticipate between $25-30 million in “annual pre-tax cost synergies” under the proposed merger.
Stokes, 85, would chair the board of the combined group before stepping down in February.
Heith Mackay-Cruise, the chair of Southern Cross, would then take on Stokes’ role as chair.
Seven West Media managing director and chief executive Jeff Howard would take on the same role in the combined group.
“The combination of these two companies brings together the best creators of media content in the country, delivering significant financial and strategic benefits for SWM shareholders,” Stokes said in a statement.
“This is an important merger, as the combined company will be better able to serve both metropolitan and regional viewers, listeners, partners and advertisers.
“It will add strength to each of the combined businesses’ television, audio, digital and publishing operations across the country.”
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Southern Cross chief executive John Kelly said the combined company would have “compelling growth opportunities”.
“(Southern Cross) has been a consistent advocate for value accretive media consolidation. We have invested considerable time and resources evaluating and responding to proposals put forward by third parties,” Kelly said.
“The proposed merger with SWM provides demonstrable benefits to our shareholders, a clear strategic path forward and is deliverable for our shareholders if approved by SWM shareholders.”
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Under the proposed plan, Seven West Media shareholders would receive 0.1552 Southern Cross shares for every Seven share.
This would result in Seven shareholders owning 49.9 per cent and Southern Cross shareholders owning 50.1 per cent of the combined business.
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