It looks as though APN News and Media (and its biggest shareholder, News Corp) and Fairfax Media will have to wait until well into early 2017 for a decision from NZ regulators about their proposed print, radio and digital website merger which would see the Kiwi print interests of Fairfax and the various websites backed, into NZME, the APN print and Radio spin off.
The NZ Commerce Commission issued a statement yesterday (http://www.comcom.govt.nz/the-commission/media-centre/media-releases/detail/2016/nzmefairfax-merger-update) which said a decision on the proposed merger had been delayed until March 2017.
If approved, Fairfax will emerge as the dominant shareholder in the merged company with just under 50%, but well ahead of the 14.9% stake held by News Corp, which is the dominant shareholder in APN, and which faces a similar decision in two proposed deals here in Australia.
But Fairfax and NZME (and APN and News as interested parties) and others will find out the Commission’s preliminary attitude in early November when a draft determination will be released.
The Commission said in yesterday’s statement it had agreed with NZME and Fairfax to extend the deadline for the two companies’ application to merge.
“NZME and Fairfax lodged their application on 27 May 2016 and the Commission has received a large number of submissions from interested parties. The proposed merger is complex and involves two-sided markets – advertisers on one side and consumers (readers) on the other.
"The commission is continuing to assess the effects of the proposed merger on areas such as the provision of national, regional and local news content and information, including the impact on the quality, accuracy and range of the news media in New Zealand. In addition, the commission is assessing whether the proposed merger would enable the parties to increase prices to advertisers and consumers.”
It said the draft determination will set out a “preliminary view on whether the proposed merger would be likely to result in a substantial lessening of competition as well as balancing the public benefits and detriments that it may bring about”.
And the Commission said a public conference could be held in December as “an opportunity for the commission to test the views of NZME and Fairfax and interested parties” on the issues raised in the draft. It said a final decision would be made “on or before" March 15, 2017.
It is clear from the statement, the deal is not going to happen as fast as they had privately though in May when the application was lodged.
Some were hoping for a decision by the end of this year.If the submissions from ‘interested parties’ had been in favour the merger, then there would not have been a delay to next March 15 at the latest, so clearly there is some concerns about such merger happening.
From the statement it is clear that some of the “large number of submissions’ are sceptical, hence the Commission saying it “is continuing to assess the effects of the proposed merger on areas such as the provision of national, regional and local news content and information, including the impact on the quality, accuracy and range of the news media in New Zealand. In addition, the commission is assessing whether the proposed merger would enable the parties to increase prices to advertisers and consumers.”
In Australia the competition regulator, the ACCC has promised a decision by September 15 on a similar, though smaller merger in Perth where Seven West Media has applied to buy the Sunday Times and Perth Now website from News Corp Australia.
The ACCC is also considering an application from News to buy 16 regional dailies and a group of smaller weekly and community papers from APN. These are based in Northern NSW and throughout regional Queensland.The Commission has yet to make a statement on the application.
