Seven and KKR can’t take a trick It’s not just the Seven Network which is a dud stock picker and facing a worsening profit outlook. It’s private buyout partner, KKR, can’t take a trick either. It reported a loss in the first half of 2008 of just over $US1 million, after suffering investment losses of $US1.2 billion.
That puts Seven’s realised loss of $14 million so far on listed investments being sold in the shade. Seven is facing a further $70 million of unrealised losses on listed investments. It also has a further unrealised loss on its 22% in West Australian Newspapers, but that won’t be sold. With Kerry Stokes and his right hand man, Peter Gemmell going on the board of WAN, Seven will equity account the investment. KKR’s results were revealed in a filing in the US and reported by Bloomberg.
“The net loss for the first six months was $US1.1 million, compared with net income of $US667.4 million a year earlier, the New York-based company said today in a regulatory filing. Investment profits were $3.37 billion a year earlier amid a record boom in leveraged buyouts. “The lack of credit has materially hindered the initiation of new, large-sized transactions for our private-equity segment and, together with declines in valuations of equity and debt securities, has adversely impacted our recent operating results,” New York-based KKR said in a filing with the U.S. Securities and Exchange commission.
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KKR is pushing ahead with a public listing on the New York Stock Exchange via the takeover of the Amsterdam- listed buyout fund it created in May 2006. KKR Private Investors securities have plunged 60% from the opening quote of its listing last year. KKR was forced to bail it out and the backdoor listing is part of the solution. Bloomberg said KKR had $US60.7 billion in assets under management as of June 30. And some of that is in the Seven Media Group, which it co-owns with the Seven Network Ltd.
Seven said it had $A1.3 billion in cash left from the sale of that stake in Seven Media to KKR. The company was valued at that yesterday, so the 50% of the TV and magazine businesses is valued at nothing. That cash holding will be reduced by the share buyback which started yesterday and could snap up to 19.4% of Seven’s shares. That would see Kerry Stokes’ holding rise past 50%. — Glenn Dyer
Lost in translation. Courtesy of a press release from the Western Australian Electoral Commission:
The Western Australian Electoral Commission has today found the parcel of ballot papers from the Queen Elizabeth Centre in Geraldton that was previously unlocated.
They will be included in the Geraldton count before the result is declared tomorrow.
PR 101, announce it but don’t use the “L” word. Not lost, but unlocated… — Crikey reader Kayt Davies
Media threatened by Anti-Gay advocates Bosnia’s journalists’ association warned Monday that local media supporting organisers of the country’s first-ever gay festival were being threatened and called on police to investigate the cases. Three radio stations and an independent weekly magazine were receiving threat letters for offering “unbiased and ethical” reports about the four-day Sarajevo Queer festival which is to open on Wednesday, an association statement said. — AFP
Advertisers out of touch What certain Advertisers fail to understand is that ubiquity and relevance are not the same thing. When everything from egg shells to urinals are turned into advertising media, something has gone horribly wrong. Somehow, somewhere, marketers have lost sight of what marketing is really about — which is “to help people solve problems and live happier lives.” Instead, they have created “an epidemic of irrelevance [that] has brought once-powerful brands to their knees.” — Los Angeles Times
Telegraph journo speaks from behind the curtain I received this email from a person whose identity I know. He/she is a Daily Telegraph journalist, but I have a feeling it could have come from the newsroom of many titles, whether national or regional. I thought it deserved a wide audience because it says a great deal about the new culture within newspapers. I have amended it only very slightly in order to preserve the person’s anonymity. I do not necessarily agree with the writer but I am certain that many of you will be nodding throughout:
“I note that you’ve always said that society needs journalists, but it is looking increasingly unwilling to pay for them. I can see, from here, that national newspapers are beginning to head in the direction that local papers went 20 years ago, demanding levels of commitment — in hours and workload — that are unsustainable in conjunction with a normal family life…” — Greenslade blog
Greenslade responds to complaints I posted the email yesterday because, despite my misgivings, I think he/she articulated many complaints I hear, and receive, from journalists who have come into the business in the past decade or so. These are the people who knew just a little of life in newsrooms before the net and are now living through the disruptions caused by the changing culture of multi-platform journalism. Let’s get one thing understood right away. All notions that reporting and subbing on national papers was infinitely better/ more professional/ more informative for readers/ journalistically superior to the present day are a form of misguided nostalgia. — Greenslade blog
Canadian media giant CanWest sues satirists When the bottom line is threatened, corporations typically show little concern for holding the line on political principles such as freedom of expression. In capitalism, freedom is too often just another word for maximizing profits. But even when we have no illusions about the predatory nature of modern corporate capitalism, there’s something particularly disheartening when a media corporation abandons free-speech principles. Journalists are supposed to be the good guys on freedom of expression, right? If for no other reason than self-interest, shouldn’t media managers support these principles? Yes, but apparently not when ideology gets in the way, as seems to be the case at Canada’s largest media corporation. CanWest is trying to use trademark law to punish political activists’ free speech in a classic SLAPP (strategic lawsuit against public participation). — Alternet
Can unionisation help print media? Unions indeed are part of the problem for some of the newspapers struggling to survive the historic distress that has rocked their world. But unions, imperfect as they may be, help to level the playing field for workers. They are valuable and we need to protect them. Now that the industry is in an epic mess, everyone who wants to keep their job and preserve a vigorous press needs to stop trying to preserve a retrospective and romanticized vision of the newspaper business and to get real about such problems as collapsing readership and plunging revenues. — Newsosaur
Collaboration bad for competition The World Federation of Advertisers on Monday sent a written protest against the Google-Yahoo ad revenue deal to the European Commission’s Directorate-General for Competition. The Association of National Advertisers also sent its own letter protesting the potential Google-Yahoo partnership to assistant attorney general Thomas O. Barnett earlier this month “The World Federation of Advertisers (WFA) fears that the proposed advertising alliance between Yahoo and Google will have a detrimental effect on competition, result in price increases and reduce the options available to advertisers worldwide — Channel Web Blogs
The honest advertising exemption Political advertising is the only safe haven for a candidate to lie about him/herself or his/her competition and get away with it. Instead of having to prove its political ad to be true, the advertiser simply needs it not to be proven false easily. And there’s no real risk of that, as the network censors, the FCC and congressional oversight committees most often sit the ad dance out when it comes to a political ad’s actual factual content. If a toothpaste company were to claim its product was the No. 1 cavity fighter in a 30-second TV spot, the broadcast censors from every station and network would demand reams of quantifiable proof and substantiation before the commercial hit the airwaves. — AdWeek