SCA likes what it sees in new ARN bid

Chris Pash
By Chris Pash | 18 March 2024

Broadcaster SCA has decided to "re-engage" with ARN Media after the competitor increased its takeover offer.

ARN and private equity firm Anchorage Capital Partners, fresh from having their takeover proposal of competitor SCA rejected, on Friday sweetened the offer.

The complicated offer, made in October last year, valued SCA at $330 million, made up in part cash and part shares.

SCA shareholders would get 0.753 ARN shares and 29.6 cents cash per SCA share. ARN has now increased the ARN exchange ratio to up to 0.87 ARN shares per SCA share, subject to the satisfactory completion of outstanding due diligence.

The SCA board of directors says it has reviewed the updated deal and has unanimously determined to re-engage.

“The consortium’s revised proposal will provide a significant increase in the consideration for SCA shareholders, and the SCA board is willing to re-engage on the basis of the higher value now being put forward," said SCA chair Rob Murray. 

Murray, facing a vote to unseat him by dissident shareholders, says he will be standing down as chair and director this year, no later than the 2024 Annual General Meeting, after a decade with the company.

Since the SCA board rejected ARN's first offer, after a long due diligence process, a significant SCA shareholder is leading a revolt against the board of directors.

Spheria Asset Management has given notice it will try to remove the broadcaster's chairman, Robert Murray.

The funds manager, holding more than more than 5% of the company's shares, has given notice that it intends to call a general meeting of shareholders to vote to remove Murray.

ARN now says it will vote 8% of issued share capital in SCA that it holds in favour of Spheria's proposed resolutions at a general meeting of SCA shareholders.

Glen Boreham, who joined SCA as an independent non-executive director in 2014, is also stepping down.

SCA reported revenue down 2.9% to $252.6 million for the half year to December and net profit after tax at $4.4 million, a drop of 71.1%.

ARN says SCA's cost saving program, said to deliver about $20 million in savings in the current financial year, has yet to be independently reviewed by ARN due diligence advisers.

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