Nine completes Fairfax merger

Nine Entertainment (NEC), the company behind Australian broadcaster Nine Network, has completed its merger with domestic newspaper giant Fairfax.

Hugh Marks

The deal will see the Fairfax name retired, with the enlarged company now set to be known as Nine. It will be structured into four groups: Television; on-demand streamer Stan, which was previously co-owned by Nine and Fairfax; Publishing; and Australian Community Media and Printing.

Titles such as The Sydney Morning Herald and Melbourne’s The Age will now become part of Nine’s operations.

The merger follows last year’s relaxation in Australian media ownership rules, which now allow newspaper, radio and TV networks to be owned by the same company in the same city.

Shareholders at Fairfax overwhelmingly supported the deal last month, with regulators concluding the merger would not substantially lessen competition in any media market.

The merger has caused consternation to some, however, with journalists’ body the Media, Entertainment and Arts Alliance describing it earlier this year as a “body blow to media diversity and the forerunner to future mega-deals that will reduce coverage of matters of public and national interest and do untold harm to media jobs.”

NEC and Fairfax have said the merger will result in annual savings of A$50m (US$35.5m). Almost 150 redundancies are planned, although many of those relate to currently vacant positions.

Nine CEO Hugh Marks said the deal “presents an opportunity to reset and chart our course as one business.”

“Nine’s mission – to create great content, distribute it broadly and to engage both audiences and advertisers – will not change,” he continued, adding that “the breadth of our opportunity to do so will increase significantly” through the addition of Fairfax’s titles.

“We are a business filled with passionate and driven people – especially when it comes to both the content and journalism we create,” Marks said. “Regardless of what part of the business you work in, what you do is important and it matters to our business. In a world where audiences have abundant choice about the media they engage with, being not just good but great at what you do matters more than ever.

Marks said the enlarged company collectively spends more than A$850m a year investing in Australian content.

However, the companies have faced financial struggles as the media landscape shifts online. When the deal was announced in July, the combined stock value of the two businesses was A$4.2bn but the stock prices of both companies have since slumped and the deal is now worth around A$2.9bn.