-- News Corp. makes A$1.94 billion bid for Consolidated
Media
-- Bid is A$3.45/share, less than previous non-binding offer
-- Shareholder James Packer says bid price fair
(Recasts first paragraph, adds ownership structure and deal
background from third, shareholder comment in sixth.)
By Gavin Lower
MELBOURNE--News Corp. (NWS) bid 1.94 billion Australian dollar
(US$2 billion) for Australian media-investment company Consolidated
Media Holdings Ltd. (CMJ.AU) as it seeks to boost its presence in
Australia's pay-television market.
In a statement Friday, Consolidated Media said that News Corp.,
owner of this newswire, had made a A$3.45-a-share bid for the
company, less than its previous non-binding proposal of
A$3.50-a-share in June and only slightly above the A$3.42 level the
shares were trading at before the bid was announced.
News Corp. and Consolidated Media each own 25% of Australia's
largest pay-TV company Foxtel and 50% of sports-channel Fox Sports.
Australian telecommunications company Telstra Corp. (TLS.AU) owns
the rest of Foxtel.
Consolidated Media said shareholders would additionally receive
a final dividend of 6 Australian cents a share--which means they'd
get the equivalent of A$3.51 for each share under News Corp.'s
bid.
Consolidated Media said most of its directors recommended that
shareholders accept the bid, and that Australian casino billionaire
James Packer, whose Consolidated Press Holdings owns 50% of the
company, intended to vote in favor of the deal.
"In my view, this is a great outcome for CMH shareholders and
for News and it reflects a fair price," Mr. Packer said in the
company's statement.
The deal may face opposition from Consolidated Media's other
major shareholder--Seven Group Holdings Ltd. (SVW.AU), which owns
25% of the company and has asked Australia's competition regulator
to consider whether it could buy the shares in Consolidated Media
it doesn't already own.
Consolidated Media directors associated with Seven Group
declined to make a recommendation on News Corp.'s bid, Consolidated
Media said. A spokesman for Seven Group didn't immediately reply to
a request for comment.
Seven Group also owns 33% of media company Seven West Media Ltd.
(SWM.AU), and its request to the Australian Competition &
Consumer Commission has been widely seen by analysts as a tactic
either to extract a sweetened bid from News Corp. or deliver a deal
on sports-broadcasting rights.
The ACCC has already said it has no objections to News Corp.'s
bid and is yet to decide on Seven Group's proposal.
Write to Gavin Lower at gavin.lower@wsj.com
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