APN sells regional papers to News Corp
APN News & Media is cutting its ties to the Australian newspaper industry by offloading its regional publishing operations to Rupert Murdoch’s News Corp.
News Corp executive chairman Rupert Murdoch.
APN chairman Peter Cosgrove said the $36.6 million sale of the group’s Australian Regional Media division represented a “significant milestone” as it focused on lucrative radio and outdoor advertising.
“The divestment of ARM is an historic day for the company as APN has been the custodian of some wonderful newspapers whose community roots go back over 150 years,” Cosgrove said.
“We are now passing that ownership onto another media group with deep publishing experience across regional Australia.”
APN shareholders, who include New Corp with a 14.9 per cent stake, last week overwhelmingly backed the demerger of its New Zealand publishing operations.
NZME is pursuing a merger with rival Fairfax New Zealand.
Cosgrove said APN would be a more “nimble media company” purely focused on growing its media assets of radio and outdoor, once the sale of ARM was wrapped up.
Chief executive Ciaran David was also bullish about the future, adding that radio and outdoor were “terrific mediums” for advertisers.
“The sectors are growing, they are complementary, and they have both led innovation in the media industry across the digital sector,” Davis said.
ARM consists of 12 daily newspapers, 60 community newspapers and non-daily publications, plus more than 30 regional news websites and mobile sites.
APN will use the bulk of the proceeds to pay down debt.
With News Corp on APN’s share registry, APN shareholders will need to vote on the proposed sale, most likely in August.
The sale will also need approval from the Australian Competition and Consumer Commission and the Foreign Investment Review Board.
News Corp is Australia’s biggest media company, boasting a stable of newspapers including The Advertiser, The Daily Telegraph, The Australian and The Courier Mail.
It also holds a stake in pay-television group Foxtel.
The company also owns a raft of newspapers in the UK and the US, including The Sun, The Wall Street Journal and The New York Post, plus book publisher Harper Collins.
APN shares were down seven cents to $4.83, giving the company a market capitalisation of $946.7 million at 1149 AEST.
-AAP
