Macquarie Radio Network (MRN) and Fairfax Radio Network (FRN) have agreed to a “merger of equals”, which will see Fairfax take a 54.5% majority shareholding under the deal.
In a merger implementation agreement (MIA) submitted to the ASX today, MRN will acquire 100% of the shares in FNR, with Fairfax receiving issuance of new MRN shares in term, equating to appropriately $18million. At the end of the deal MRN shareholders will hold 45.5% of the company, with Fairfax holding the remaining 54.5%.
While the two companies have fallen out over merger talks in the past, which was believed to be over the future of MRN hosts Ray Hadley and Alan Jones, the MIA includes a condition to ensure their retention. The agreement will also mean that several stations across the two networks will consolidate, including 2UE and 2GB in Sydney, 3AW and Magic 1278 in Melbourne, 4BC and Magic 882 in Brisbane and 6PR in Perth.
Fairfax CEO and MD Greg Hywood said: “This is a compelling transaction for both Fairfax and MRN. The merger creates a genuine national talk radio network that was not previously available to advertisers.”
“The merger brings together the greatest mix of talkback talent ever assembled in a single radio network.”
MRN will sell 2CH under the arrangements. In addition, Fairfax has entered into a separate agreement to sell Perth-based 96FM to APN owned Australian Radio Network (ARN) as it looks to build onto its national brand, Kiis.
The deal is subject to shareholder approval and a general meeting is expected to be held in March 2015. In a statement to the ASX, MRN's directors noted their intention to recommend shareholders vote in favour of the transaction.
MRN boss John Singleton said: “Joining forces is a win for both MRN and FRN. Radio was the world's first form of social media, and the only one I understand.”
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