Nine acquires "opportunistic" stake in Southern Cross

Arvind Hickman
By Arvind Hickman | 18 March 2016
 

Nine Entertainment Co has acquired an "opportunistic" 9.99% stake in Southern Cross Media Group, fuelling speculation of a merger if Mitch Fifield's media reform package passes the senate.

Nine moved swiftly to shore up its interest by acquiring just under 10% of Southern Cross shares at $1.15. An exclusive negotiation period between Southern Cross Media Group and Network Ten expired this week.

Southern Cross Media Group includes the radio network Southern Cross Austereo - which has MMM and Hit radio stations - and Southern Cross TV assets across regional Australia. 

Ten has already rebuffed Southern Cross' TV assets and is believed to be eyeing a tie-up with WIN.

A Nine spokesperson tells AdNews the share grab provides it with greater options ahead of an expected flurry of media consolidation activity once ownership laws are relaxed.

"We think SXL (Southern Cross Media Group) is a good business and the stake provides us with flexibility regarding various options that we are considering and it was acquired opportunistically. We intend to actively seek opportunities that create value and that are in shareholders' interests," the spokesperson says.

Yesterday, Fairfax Media reported that Telstra is considering selling its 50% stake in Foxtel via an IPO. Telstra told AdNews it wouldn't comment on speculation but Foxtel remains a "strategic asset" for the telco.

A media agency source tells AdNews rumours of Telstra pulling out have been doing the rounds for some time and the ability of the telco to bundle mobile, internet, landline and Pay TV content was a compelling reason for it to continue the joint venture.

The speculation came in the wake of a Foxtel leadership change as Peter Tonagh took over the reins from Richard Freudenstein.

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