Nine Entertainment to create an empire, snap up Fairfax Media

Company News

by Jessica Amir

Nine Entertainment (ASX:NEC) and Fairfax (ASX:FXJ) inked a deal to merge, which will make Nine one of Australia’s largest media companies.

The proposed deal is subject approvals, involves Nine buying all of Fairfax shares. If implemented, Nine shareholders will own 51.1 per cent of the new entity, and Fairfax shareholders will own the remaining 48.9 per cent, with the combined businesses to be led by Nine’s CEO Hugh Marks, while Peter Costello will be chairman.

New Nine shares will start trading in the week beginning 26 November, and Fairfax shares will stop trading on the ASX in the first week of December.

Fairfax shareholders will receive 0.3627 Nine shares for every Fairfax share (scrip consideration) and $0.025 cash (cash consideration) per Fairfax share. The total consideration is a 22 per cent premium to Fairfax’s closing price on 25 July 2018 [$0.77].

The combined business includes Nine’s free-to-air TV network, a portfolio of online businesses including Domain, Stan and 9Now, as well as Fairfax’s mastheads and radio shows through Macquarie Media.

Nine is expecting to report Group EBITDA (for the year ending June 2018), at the upper end of its guidance ($250-260 million).

Shares in Nine Entertainment (ASX:NEC) last traded at $2.52 while Fairfax (ASX:FXJ) shares last traded at $0.77.

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter with Prime7 and Win News.