Friday, January 14, 2005

Media manoeuvres

As The Australian reported yesterday Fairfax and Channel Ten are in discussions over a possible sale of the television network to the newspaper group. Ten has had a bumpy financial history but the Asper family have done well after buying in at 10 cents a share and are looking to sell at more than 40 times this price.

But the catch will be the complex structure that Canwest, the Asper's company, devised to skirt Australia's cross media ownership laws. Can it be transferred to a buyer? The MEAA has asked the ABA to investigate, so we should know something before the next election.

The Prime Minister has said that media legislation reform is on the agenda, but not high on his list of priorities. It's high on some people's list, though.

The major Australian media companies include:

* News Corp which is now US-based. With a market cap of $65 billion it can afford to buy whichever Australian media company it chooses, but any expansion plans will be limited by ongoing foreign ownership limits.
* PBL is Australia's largest domestic media company with a market capitalisation of $11.3 billion.
* Fairfax is the next largest at $4.53 billion. This makes it too large for PBL to pick up unless it offers a scrip deal.
* Ten is the fourth largest media company with a market cap of $1.7 billion followed by Channel Seven at number with a market value of $1.4 billion.

No comments: