Media reports claim the two companies are negotiating a $2.2 billion merger that does not breach media ownership laws.

Southern Cross Media said it had not received or made any merger proposal although it had been reviewing the company’s strategic options.

Nine Entertainment stated from time to time over the past few years it had been in discussions with Southern Cross Media on various commercial and broader business transactions.

“NEC and Southern Cross Media have not reached any agreement on any transaction,” a statement from the television broadcaster said.

A full merger of the two would breach media ownership laws which prohibit television broadcasting licences which cover more than 75 per cent of the country’s population.

Media industry analyst and Fusion Strategy founder Steve Allen dismissed the merger speculation as rumours.

“I think this is hot air that somebody is being opportunistic with,” he said.

“Nobody of any recognition, the ASX hasn’t been advised, have been attached to this rumour which has been around seven months ago.

“Their talks could involve any number of things. They could have sat down and discussed joint sports bidding or the television licence fees they pay.”

Southern Cross Media owns 104 television channels with contracts with Nine’s arch rivals Network Ten and the Seven Network.

It also owns and operates a commercial radio network in Australia with 78 commercial radio licences.

Nine is a free-to-air TV broadcaster with digital channels and online on Mi9’s news and entertainment portal.

Its assets include the Ticketek, Allphones Arena, Mi9 as well as interests in Sky News Australia and ASX-listed financial services company, Yellow Brick Road.

Shares in Nine were down four cents to $1.515, while shares in Southern Cross Media was flat at $1.105 at 11.25am (AEDT).

AAP