SYDNEY: Australian media companies Seven West Media Ltd (SWM.AX) and Southern Cross Media Group Ltd (SXL.AX) on Tuesday announced an all-scrip merger agreement to create a leading integrated media platform, aiming to better compete for advertising revenue in a fragmented market.
Under the terms of the deal, Southern Cross Media (SCA) will acquire all shares in Seven West Media (SWM) via a Scheme of Arrangement. SWM shareholders will receive 0.1552 SCA shares for each SWM share held. Upon completion, SWM and SCA shareholders will own 49.9% and 50.1% of the combined entity, respectively.
The merger brings together Seven’s broadcast television network, streaming service 7plus, and digital publishing assets with Southern Cross’s metropolitan and regional radio stations and digital audio platform LISTNR. The companies said the combination would create a “Total TV, Audio and Digital platform” with significant scale across metropolitan and regional Australia.
The boards of both companies have unanimously recommended the transaction, which is subject to regulatory approvals and a vote by SWM shareholders. Major SWM shareholder, Seven Group Holdings Ltd (SGH), with a 40.2% stake, has indicated its intention to vote in favour.
The combined group is projected to have a market capitalisation of approximately A$417 million ($277 million), based on the last close of shares on Sept. 29.
In a joint investor presentation, the companies highlighted the strategic rationale, citing the ability to attract high-value audiences, create a seamless solution for advertisers, and harness combined data. They expect to realise annual cost synergies of A$25 million to A$30 million within 18 to 24 months of deal completion.
The leadership of the combined group will see Kerry Stokes, a nominee of SGH, serve as Chair until the end of February 2026, after which SCA nominee Heghi Mackay-Cruise will assume the role. Jeff Howard will be the Managing Director and CEO.
The transaction is expected to be implemented by the first quarter of 2026.
($1 = 1.5052 Australian dollars)