APN News & Media-owned NZME and Fairfax NZ have placed their case for a merger before The New Zealand Commerce Commission, seeking an authorisation to proceed from the regulatory body.
It was the second major regulatory listing on Friday, with the appearance earlier of the proposed purchase of News Corp Australia’s The Sunday Times by Seven West Media on the Australian Competition and Consumer Commission register.
The intention of NZME to merge its New Zealand assets with those of Fairfax was disclosed at APN’s annual general meeting this month, as was the proposal to demerge NZME to list it as a separate company on the NZX and ASX
Fairfax operates the largest print media network in New Zealand, featuring nine daily and three weekly newspapers, 61 community publications, 10 magazine titles and six websites, including stuff.co.nz. It also has a minority shareholding in social media site Neighbourly.
NZME owns eight daily and two weekly newspapers, 24 community publications, six magazine titles, 10 radio stations and 38 websites, including nzherald.co.nz. As well as websites related to its print and radio offerings, NZME owns a number of individual websites such as Grabone, Shop Green and Adhub.
The Commerce Commission said the ownership structure for the proposed merged entity had not yet been established because of the NZME demerger was yet to occur.
“In the event shareholder approval is gained, it is currently proposed that NZME will acquire Fairfax assets or shares from parent company Fairfax Media Limited, for a mix of new shares in NZME and cash,” the regulator said.
“Fairfax Media’s shareholding in the merged entity is expected to be less than 50 per cent.”
The commission said it would issue a statement of preliminary issues and call for submissions on the authorisation early in June. The release of preliminary issues could indicate the commission already has concerns over ownership concentration or competition issues.
APN chief executive Ciaran Davis believed the commission should back the merger. The combination of the two businesses would provide “the necessary capability to continue investing in high-quality, local news, sport and entertainment at a time when advertiser commercial investment continues to fragment across international media platforms that do not invest in local content”.
Both companies would like to complete the merger, if approved, by the end of the year.
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