The biggest shake-up in NZ media has been rejected by the country’s competition regulator in a “draft” decision declining to green light the merger of NZME and Fairfax Media’s Kiwi newspapers and websites. NZME is the spin-off of APN News and Media’s New Zealand print and radio interests. News Corp was the largest shareholder, but revealed this morning in its quarterly results that the 14.9% stake had been sold.
The proposed merger, announced mid-year would have had Fairfax emerge as the biggest shareholder with around 42%, plus two board seats and A$55 million in cash. Now that looks like it will be blocked, unless the partners can come up with radical proposals to change the regulator’s mind.
The rejection will worry Fairfax. Coming after the weak trading update last week, especially for its Domain Australian property website, Fairfax shares are under pressure and so is the $2 million CEO, Greg Hywood. This rejection won’t make life any easier with NZ revenues down 4% in the first quarter of 2016-17. — Glenn Dyer