NZME pulls plug on Stuff merger

A proposed merger between NZME and Stuff is over with the dominant New Zealand newspaper publishers deciding against taking their case to the Supreme Court.

"NZME will not appeal the Court of Appeal’s adverse decision in relation to the proposed merger of NZME and Fairfax Media's New Zealand subsidiary Stuff. This brings the merger process to a conclusion," the company said in a brief statement. The publisher of the New Zealand Herald newspaper has previously indicated a willingness to take the case to the Supreme Court.

Fairfax Media was not immediately available for comment. 

The two companies applied to amalgamate in 2016, arguing the merged entity would be more able to survive the global competition for local advertising dollars from online search and social media giants such as Google and Facebook. 

The Commerce Commission declined to clear the merger, arguing it would concentrate too much media influence in one entity. A subsequent appeal by NZME and Stuff, heard in the High Court in October 2017, was unsuccessful. 

In a second appeal Stuff and NZME claimed the Commerce Commission went beyond its mandate by ignoring economic gains from the tie-up for fear of diluting diversity of voices in the media landscape. That appeal was dismissed by the Court of Appeal. 

Both NZME and Stuff have pursued alternative strategies in the absence of a merger. NZME has rolled out new units aimed at capturing digital advertising and is in the process of developing paid-for premium content.

Meanwhile, Stuff has closed or sold a third of its mastheads, largely regional giveaway newspapers and agricultural publications. It is also building a suite of utility products such as retail broadband service Stuff Fibre. Australian parent Fairfax is in the middle of its own A$2.2 billion merger with Nine Entertainment Co. The New Zealand arm isn't seen as a core business if the Australian merger goes ahead. 

NZME said it will continue to focus on growing audience and engagement and achieving advertising revenue growth. NZME shares were unchanged at 63 cents. 

(BusinessDesk)

Comments from our readers

No comments yet

Add your comment:

Your name:
Your email:	Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Anti-spam verification:

Type the text you see in the image into the field below. You are asked to do this in order to verify that this enquiry is not being performed by an automated process.

Related News:

Now is the time to reassess your investments
Now is the time to reassess your investments
Fonterra looking to lift China's importance in new strategy
A2, Synlait shares climb as takeover bid revives optimism about Chinese appetite for milk
Service sector activity eases in August but still expanding
Lumpy imports drive bigger July trade deficit than expected
Nimbys, carparks and the status quo under threat as govt tells big cities: grow up and out
Dairy manufacturers got better prices in June quarter
Orr defends RBNZ rate cut, says monetary policy looks ahead, not behind
RBNZ's Orr says investors need to put their money to work