Fairfax Media has announced plans to merge its Fairfax Radio Network (FRN) with Macquarie Radio Network Limited (MRN) in a move which will give Fairfax a 54.5 per cent share in an enlarged MRN, which will remain listed on the ASX, as well as an $18 million cash boost for the publisher.
The merger will elevate Fairfax to majority shareholder in a network containing leading talk, news and sports stations in Sydney and Melbourne, expanding its existing stable, which comprises stations including 2UE, 3AW and 4BC, to include 2GB and 2CH. MRN will acquire 100 per cent of FRN shares.
At the same time, Fairfax has sold Perth station 96FM to APN News and Media Limited for $78 million, bringing its haul from both transactions to $96 million.
The merger is expected to be completed in March 2015, subject to MRN shareholder approval.
Fairfax Chief Executive Officer and Managing Director Greg Hywood described the merger as “a compelling transaction for both Fairfax and MRN” as it would create a national Talk radio network not previously available to advertisers.
“The merger provides both cost and revenue synergies from enhanced network and sales opportunities that will create a more efficient and effective network for News, Talk and Sports radio along with music stations,” Mr Hywood said.
“The merger brings together the greatest mix of talkback talent ever assembled in a single radio network. Leading presenters engage listeners with an unprecedented quality and diversity of commentary, entertainment and sport coverage.”
MRN executive chairman and chief executive Russell Tate will head the board of five directors of the combined entity as executive chairman, with two Fairfax nominees, one further MRN nominee and one Independent Director to make up the directors.
The 96FM sale is expected to be completed in February 2015, subject to approval from the Foreign Investment Review Board.
“In considering the MRN transaction, Fairfax considered it appropriate to accept a compelling offer for our Perth music station 96FM from APN,” Greg Hywood said.
“The station is a strong strategic fit with APN and we believe they are the natural owners of this station for the future.”
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