19 Nov 2018

Fairfax shareholders back Australian media merger

2:04 pm on 19 November 2018

Fairfax shareholders have overwhelmingly backed a takeover by Nine Entertainment, paving the way for both companies to merge by the end of this year.

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Photo: AFP

At the Fairfax annual general meeting today, more than 80 per cent of votes were in favour of the deal.

Antony Catalano, the former head of real estate website Domain, tried to block the deal by submitting a last-minute bid for 19.9 percent of the newspaper publisher's shares on Sunday evening.

However, the Fairfax board knocked back Mr Catalano's offer because it was not considered to be a "superior proposal".

"The letter contains no actual proposal that could be considered by Fairfax shareholders as an alternative to the proposed scheme of arrangement with Nine," Fairfax said in a statement.

"The Fairfax board believes that the value and strategic opportunities offered by the scheme reflect a compelling proposition for Fairfax shareholders."

Mr Catalano said he would take legal action to prevent the deal going through.

The merger was already approved by the Australian Competition and Consumer Commission (ACCC) earlier this month.

ACCC chairman Rod Sims said at the time that Australia would be "slightly worse off" because of the lessening of competition in the news market.

But the competition watchdog approved the deal because it would not "substantially" lessen competition, particularly given the recent rise of online news providers such as The Guardian, The New Daily, BuzzFeed, Crikey and The Daily Mail.

Nine's takeover of Fairfax is subject to final court approval on November 27.

Provided it obtains court approval, the merger is scheduled to be completed on December 7, with the combined group beginning business on December 10.

It also means the Fairfax brand name - after 177 years of operation - will cease to exist.

The new entity, which will simply be called "Nine", will own the Nine Network, The Sydney Morning Herald, The Age, The Australian Financial Review, a majority stake in Domain, streaming service Stan and a 54.5 per cent stake in radio network Macquarie Media.

It will be led by Hugh Marks and Peter Costello, the chief executive and chairman of Nine Entertainment.


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