Misleadingly named on two scores, Independent Newspapers – a New Zealand newspaper group 49%-owned by Rupert Murdoch’s News Limited and without a single NZ publication to its name – is poised to make a formal bid for the 33.75% shareholding in Sky Network Television it does not already own.
The move has been expected for many months, especially after April’s disposal of all IN’s indigenous publishing assets to Australia’s John Fairfax Holdings [WAMN: 15-Apr-03]. Since when the proceeds - NZ$754 million ($431.06m; €394.49m; £272.82m) - have been burning a hole in IN’s pocket.
IN is eager to acquire one hundred per cent ownership of New Zealand’s sole satellite broadcaster. Even before the launch of its unconditional offer (which becomes formal in September), the only other shareholder of consequence, Telecom New Zealand, has agreed to sell its 12% stake to the Murdoch-controlled company. Which leaves just 21.75% of the stock to mop up.
Offering the equivalent of NZ$4.63 for each Sky share, the NZ$613m bid is just 2.4% above Sky’s closing price last Wednesday. “It’s a bit light,” opined ASB Securities broker Stephen Wright. But few believe Murdoch will fail to get his way.
IN’s post-takeover plan is to merge with Sky under the latter’s name. From which point its sole activity will be the Sky business. It is a textbook example of Murdoch empire-building: gain command of an asset via a chain of intermediate companies in which News Corporation owns a minority but dominant stake.
Data sourced from: The Wall Street Journal Online; additional content by WARC staff