The ACCC says it won't oppose Seven West Media’s proposed acquisition of regional broadcaster Prime Media.
The consumers watchdog considered feedback from advertisers and advertising agencies in making its decision.
However, the key event on the takeover will be a vote by shareholders of Prime due tomorrow.
In its annouceement, the ACCC noted media speculation that Prime’s shareholders may not vote in favour of the deal.
James Warburton's Seven West Media appears to have hit an obstacle in his quest for Prime and the creation of premium broadcast, video and news network with potential to reach more than 90% of Australia’s population each month.
Two key Prime shareholders -- billionaire Bruce Gordon and regional news player Antony Catalano -- have reportedly indicated they will reject Seven's scheme of arrangement.
Together they hold just over 25% of Prime which means that Seven West Media can't get to three-quarters of the shareholding needed to force the acqusition of the rest of the shares
The ACCC’s approval of the deal is made on the basis that Seven West Media will divest its Spirit and RedFM radio networks in regional WA to a third party.
"In assessing this proposed deal, we considered the likely impact on competition in providing local news and content to audiences in regional WA,” says ACCC Chair Rod Sims.
“We found that Seven West Media’s largely weekly regional newspapers and Prime’s weeknightly TV bulletins generally cover different news stories.
“We also looked at the likely impact on advertisers and news consumers across a number of different media markets, and concluded that the proposed acquisition was unlikely to substantially lessen competition or choice for advertisers and consumers.
“Feedback from advertisers and advertising agencies suggests that Prime’s television and Seven West Media’s newspapers don’t compete closely for advertising revenue, and most advertisers have alternative ways of reaching their target audiences.”
The majority of Prime’s broadcast content is currently supplied by Seven West Media, but Prime produces its own regional news broadcasts in some areas, including regional WA where it broadcasts the GWN7 News on weeknights.
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