Fairfax returns to radio grabbing Rural Press

Fairfax Media has announced a takeover of Rural Press which will create a combined company with assets worth more than $9 billion.

Rural Press shares were up more than 15 per cent to $13.59 at 2.45pm, while Fairfax shares dropped 19 cents to $5.02 as the markets deflated some of the takeover premium in the stock.

The takeover will create Australasia’s largest integrated metropolitan, regional and rural print and digital media business, the companies said in a joint statement to the Stock Exchange this morning.

The proposed transaction has been unanimously recommended by the Rural Press board in the absence of a superior proposal.

“This merger has been contemplated by both companies over a number of years. We look forward to the successful completion of the transaction,” Fairfax chairman Ron Walker said.

“With an enterprise value of over $9 billion, we are poised for stronger growth and further strategic expansion of our brand in Australia and overseas in the years ahead.”

At current share prices, a combined Fairfax/Rural Press will be worth $6.7 billion - the enterprise value includes debt. 

“It makes a purchase of Fairfax much more complicated,'’ Craig Shepherd, an analyst at Commonwealth Securities told Bloomberg.

“We are looking at a scenario where Fairfax just got more expensive (for predators) and a break-up of Fairfax got a little bit more problematic because one of the obvious buyers of some of the assets was Rural Press,'’ he said.

“For Rural Press it represents a fantastic way to get into a strategic asset like metropolitan papers they have always wanted.'’

The plan will add The Canberra Times to Fairfax’s stable of publications which includes The Sydney Morning Herald, The Age and The Australian Financial Review.

Under the proposal, each Rural Press ordinary and preferred shareholder will be entitled to receive, for each share held, two Fairfax shares and $3.30 in cash, or 2.3 Fairfax shares and $1.80 in cash.

In addition, the Rural Press board said it intends to declare a fully franked special dividend of 57.143 cents per ordinary share, and 62.858 cents per preferred share.

The offer, which will be voted on by Rural Press shareholders, represents a premium of around 15 per cent on the company’s current share price of $11.75. The deal does not have to be approved by Fairfax shareholders.

Mr Walker will remain chairman of the combined group and Fairfax chief executive David Kirk will have the top job. Rural Press chief executive Brian McCarthy will become deputy CEO.

The takeover will help defend Fairfax against a possible predators like private equity groups and other media organisations.

Kerry Stokes’s Seven Network confirmed yesterday it had built up a small stake in the company.

It is understood Seven owns about 3 per cent of Fairfax.

It started buying shares in October, about the same time it picked up a 14.9 per cent stake in West Australian Newspapers and before Rupert Murdoch’s News Corp paid $5.20 a share for its 7.5 per cent stake in Fairfax.

It is the latest in a series of moves by the big media players since the Federal Government announced a relaxation of the cross media and foreign ownership rules in the first half of October.

Seven, News and Publishing and Broadcasting Ltd have been quick to position themselves since the Government announced the rule changes.

However, the industry is still in the dark about when the new rules will come into effect.

The Communications Minister, Helen Coonan, said a date would not be set until next year.

This is the first takeover bid since the laws were announced but the deal can go ahead irrespective of changes to the media laws.

Just two weeks ago, Mr Stokes said Seven Media Group, its new joint venture with KKR, had not yet considered an acquisition of Fairfax.

AAP reports: Rural Press chairman John B Fairfax said the merger was a natural progression for the continued growth of Rural Press’ regional publishing business.

“The merger with Rural Press will provide opportunities for Fairfax Media to leverage its online media businesses and expertise across regional communities throughout Australia,'’ he said.

The merged group will have a geographic footprint covering the metropolitan markets of Sydney, Melbourne and Canberra, and printing and publishing with over 240 rural, regional and community publications.

It also will have a substantial presence in New Zealand, a significant agricultural publishing presence in the USA with over 20 titles, nine radio licences in Queensland and South Australia, and over five million visitors to the Fairfax Digital sites and farmonline.com.au, canberratimes.com.au and yourguide.com.au.

Source SMH

Jones faces court over witness naming

A brother of four Sydney men convicted of gang rape says he never gave broadcaster Alan Jones or The Daily Telegraph newspaper permission to name him as a juvenile witness at a murder trial. 

Jones came face to face with the witness during a hearing on charges that he named the child on his radio show last year.

During Wednesday’s hearing, a magistrate also agreed to accept into evidence police statements from the boy’s late father, who had been charged with lying during a gang rape trial for two of his sons.

Jones, 2GB licensee Harbour Radio and The Daily Telegraph publisher Nationwide News are facing charges of breaching the Childrens Criminal Proceedings Act by naming the child witness in July last year.

Police allege the boy was 14 when he witnessed the fatal attack on another man in April 2004.

He gave evidence during a murder trial last year and his name was reported in The Daily Telegraph and on Jones’ morning radio show.

The trial was eventually aborted for other reasons.

The boy told the court he did not give anyone permission to publish or broadcast his name.

But counsel for both defendants have questioned the witness’ age at the time of the trial.

Deputy Chief Magistrate Helen Syme agreed to accept two statements given to police by the boy’s father.

In the statements, the father said the boy was born on July 3, 1989.

But Liz Fullerton, SC, for Jones and Harbour Radio, told the court the boy’s father had testified during the 2003 gang rape trial of two of his sons, known only as MAK and MSK, that he did not know his children’s birthdays.

“He gave sworn testimony that he did not know the birth date of any of his children,” she said.

The father’s testimony during that gang rape trial resulted in him being charged with perjury for allegedly providing a false alibi for his sons.

He died while the matter was still before the courts.

In the Downing Centre Local Court, Peter Miller, acting for the Director of Public Prosecutions, said the boy’s father may have been unable to remember the dates at that time.

“One’s memory can be refreshed,” he said.

Speaking through an interpreter, the boy’s mother told the court she had eight children but could not remember their birth dates.

She said the births were recorded at a registry in Pakistan.

The woman said that, as part of her Islamic faith, birthdays are not celebrated annually.

Wearing a black suit and pink tie, Jones sat quietly in the court during Wednesday’s proceedings.

Previously, Ms Fullerton told the court the juvenile had a variety of aliases and alternative dates of birth, some dating back as far as 1977, recorded against his fingerprints on the police database.

MSK, MAK and their brothers MMK and MRK, are serving maximum jail terms ranging from 32 to 10 years for gang rape and other sex offences against girls as young as 13.

The hearing was adjourned to a date to be set.

ACMA says yes to low power for Perth

The Australian Communications and Media Authority will make channel capacity available for a new low power community radio service to serve the Perth city area. The new service would operate on 90.5 MHz.

The decision is contained in a variation to the radio licence area plan for Perth released today.

‘The two active aspirant community broadcasters Capital Community Radio and Western Sports Media that have been sharing the frequency will continue to share the frequency until licence applications are called for the new permanent service,’ said Giles Tanner, General Manager of ACMA’s Inputs to Industry Division.

The variation to the licence area plan includes a number of other changes to Perth radio services. The licence area of community radio service 6TCR Wanneroo has been extended to include all of the City of Wanneroo and the City of Joondalup . 6TCR has also been granted an increase in power to the north to enable it to provide coverage to all of the City of Wanneroo . There are amendments to the technical specifications for community radio services 6NR, 6RPH and 6YMS and commercial radio service 6PR to reflect transmitter site changes and power increases for the 6RPH and 6YMS services. ACMA has also withdrawn the availability of AM frequency 1170 kHz for an open narrowcasting service due to the possibility it may be required for digital radio.

ACMA’s decisions follows consideration of submissions received on a draft variation to the Perth radio licence area plan released in September 2004 and a revised draft variation released in December 2005. ACMA received over 1500 letters of support encouraging it to make an additional community radio service available in Perth .

ACMA will not be proceeding with the changes it had previously proposed to the technical specifications for the 6IX Wanneroo FM translator following submissions received on the revised draft variation to the licence area plan released in December 2005 and a subsequent field survey undertaken by ACMA.

The variation does not consider the future use of the FM frequency 100.9 MHz. The West Australian Aboriginal Media Association had been providing a community radio licence service on that frequency until October this year when ACMA cancelled its licence. ACMA will consider the future use of the frequency at a later time

Final survey for 2006 radio ratings

Survey 8 for 2006 links are below. Further updates throughout the day.

Adelaide  Brisbane  Perth  Melbourne  Sydney

Radio Ratings Survey 8

With survey 8 of the radio ratings due tomorrow we will bring you the state by state results from around 10.15am Tuesday morning.

2UE tries to block lawsuits

THE radio station 2UE has found a novel way to deal with the anti-hate laws its presenters find so troublesome: plead the constitution.

Its presenters, John Laws and Steve Price, had a combined rant about the gay couple on Channel Nine’s renovation show, The Block, in 2003, using the terms “poofs” and “grubby” in their extended attack.

A complaint was filed by Gary Burns, alleging they had breached anti-vilification provisions of the Anti-Discrimination Act. They make it unlawful to incite hatred of homosexuals. Protections also exist for race, transsexuality or having HIV or AIDS

Mr Burns filed another complaint against Mr Laws over his on-air comments in 2004 about Carson Kressley, the host of Queer Eye for the Straight Guy, which included the terms “pillow-biter” and “pompous little pansy prig”.

But both of Mr Burns’s complaints - and any other made under the vilification laws - could be thwarted if 2UE’s constitutional argument succeeds.

It says that the right to freedom of political communication - inferred from the constitution by the High Court - means state anti-vilification laws should be declared invalid. In the event of a conflict, federal laws trump state laws. If its invalidity claim does not succeed, it says the laws should be restricted to allow for the freedom of political speech.

The Attorney-General, Bob Debus, has intervened in the case, claiming the Administrative Decisions Tribunal’s appeal panel does not have the power to decide constitutional matters.

Three Court of Appeal judges have reserved their decision. (SMH)