After closing at 1.72 overnight, shares in Southern Cross Media (SXL) have opened sharply down and were trading at $1.63, or 5% lower, as hopes of a merger with Nine Entertainment Co waned.
The much-hyped pairing of Nine and Southern Cross appears unlikely to come to fruition in the near-term with independent MP Rob Oakeshott saying he won’t support the changes as they currently are.
The Opposition has also said it won’t support the Bill, with communications spokesman Malcolm Turnbull saying: “He's asking us to pass those laws by next Thursday and yet he hasn't even shown us what those laws are.
“And then if the parliament doesn't do what he demands then apparently it's all off.
“This is just childish. He's treating the parliament and the Australian people that this parliament represents with contempt.”
Changes to the 75% reach rule, which the merger between Nine and Southern Cross is predicated upon, may even not be included in the three Bills to be put to parliament. Even if the changes are included thanks to a favourable review by a parliamentary committee, the Bills seemed to be dead before they start.
Changes to the reach rule were originally supported by Seven, Nine and Ten, but Seven and Ten have had a change of heart. Any merger between Nine and Southern Cross would be highly detrimental to both of the other two networks, not to mention regional player Win, which would stand to lose Nine content.