Mega media group merger clears shareholder hurdle
Shareholders overwhelmingly backed the deal to create an Australian media giant spanning television, radio, print and digital.
Shareholders of the company that owns the Seven Network and the West Australian approved its merger with the group that owns radio stations Triple M and Hit Network on Monday.
More than 99 percent of the votes cast by shareholders voted in favor of the plan, while 88.3 percent of shareholders also voted in favor of the plan.
The transaction combining Seven West Media and Southern Cross Media Group is expected to be completed on January 7.
“The combination of these two great companies will bring together the best content creators in the country and deliver significant financial and strategic benefits,” said Seven West chairman Kerry Stokes.
“This is an opportunity to build a national, diverse media organization with broad scale and reach to free television, broadcast, audio and digital publishing assets.”
Mr Stokes said he would remain chairman of the combined group until he leaves the board at the end of February.
Seven West shareholders will receive 0.1552 Southern Cross shares for each Seven share they own as part of the merger, and will own 49.9 percent of the combined group, while Southern Cross shareholders will own the remaining 50.1 percent.
Seven West owns the Seven Network and the West Australian, as well as the Sunday Times, PerthNow, national news website The Nightly and community sports streaming platform Streamer.
Southern Cross Australia owns a total of 104 radio stations across Australia and operates the LiSTNR digital audio application.
An independent report by Kroll Australia found that although both companies have long held a strong leadership position in the Australian radio and television markets, the landscape has changed significantly in recent years.
Kroll said consumers are increasingly turning to international competitors’ on-demand streaming services, leading to declines in revenues.
Kroll said the merger will give both companies better scale and synergies to compete with these international rivals.
The deal is structured so that Southern Cross shareholders do not need to approve it, and with the Australian Competition and Consumer Commission and the Australian Communications and Media Authority already clearing the merger, Monday’s vote was the deal’s last remaining hurdle.
A court will be asked to approve the plan on Tuesday as a formality, and paperwork making the merger legally valid is expected to be submitted to securities regulator ASIC on Wednesday.
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