Southern Cross Media Considers Takeover Proposal

By Mike Cherney

SYDNEY – Southern Cross Media, the Australian radio broadcaster, has announced that it will consider a takeover proposal from ARN Media and Anchorage Capital. However, the company advises its shareholders to take no immediate action.

Complex and Highly Conditional Proposal

Southern Cross Media describes the non-binding proposal as unsolicited, complex, and highly conditional. The company assures its shareholders that it will provide updates as required.

Offer Details

ARN and Anchorage Capital have offered 0.753 ARN shares and 29.6 Australian cents (18.8 U.S. cents) in cash for each Southern Cross share. This values Southern Cross shares at 0.94 Australian cents per share, representing a 29% premium compared to Southern Cross’s last closing price. In total, the equity of Southern Cross is valued at A$225 million.

The Benefits of the Deal

ARN suggests that this merger would create a focused metro radio network consisting of 10 stations across Australia’s major cities. Additionally, it would result in a larger and profitable regional radio footprint with 88 stations.

Market Reaction

Following the announcement of the offer, Southern Cross shares experienced an 18% surge to 86 Australian cents per share in early Wednesday morning trade.