ARN Media
Hi fellas, Just hoping to get your thoughts on ARN Media's bid to acquire Southern Cross Media. How will this affect ARN Media shareholders?
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Answer
Hi,
The ARN Media bid is still being considered by Southern Cross Media (SXL), so for now there is only speculation on the outcome. The initial approach would see SXL shareholders receive 0.753 ARN shares + 29.6 cents per share (potentially franked) for each share in SXL they hold. The end result would be a company with 10 metro stations across the key capital cities and 88 regional stations.
There would be some clear synergies to be realized in the transaction, but integration remains a risk, and key management and strategy changes in media companies leaves the door open for competition to move. Southern Cross shareholders may also not want to hold shares in the new entity which could weigh on shares after the deal completes. The larger market cap of the combined group could provide some support though.
