Seven West Media and Southern Cross Media Group Limited (SCA) have agreed a merger in principle.
The merged company would seek to merge SCA’s radio and audio assets with Seven’s TV business.
The companies said it would combine two highly complementary businesses with strong positions in the Australian advertising market across their free-to-air television, streaming, audio, digital and publishing assets.
Under the Proposed Merger, Seven shareholders will receive 0.1552 SCA shares for every Seven share, which would result in SWM shareholders and SCA shareholders owning 49.9 per cent and 50.1 per cent of the combined business, respectively.
SWM and SCA management anticipate between $25-30 million annual pre-tax cost synergies, with incremental revenue synergies also expected to be created.
The pair said they have “jointly explored the opportunity for revenue synergies by enhancing audience reach and advertising scale. Further work continues to examine potential revenue synergy quantification and structure an integration plan to bring the best of both companies together,” according to a release.
Jeff Howard, Seven’s MD and CEO, would be the MD and CEO of the combined business.
John Kelly, SCA’s CEO, would become its group MD, audio.
Seven chairman Kerry Stokes would be chair of the board until stepping down in February next year and transitioning the role to Heith Mackay-Cruise, SCA’s chairman.
Following this the combined Board will comprise four representatives from the SWM Board (being Teresa Dyson, Jeff Howard, Michael Malone and Ryan Stokes AO), and three representatives from the SCA Board (being Heith Mackay-Cruise, Marina Go and Ido Leffler). Leffler has indicated his intention to continue on the combined Board through the acquisition and retire from the Board as at 30 June 2026.
“The combination of these two companies brings together the best creators of media content in the country, delivering significant financial and strategic benefits for SWM shareholders. This is an important merger, as the combined company will be better able to serve both metropolitan and regional viewers, listeners, partners and advertisers. It will add strength to each of the combined businesses’ television, audio, digital and publishing operations across the country,” said Stokes.
“This combination marks a pivotal moment for Australian media. By bringing together the complementary assets and brands of SWM and SCA, we are creating a truly national, diversified media organisation with extensive scale and reach across our free-to-air television, streaming, audio, digital and publishing assets,” said Howard.
“This merger will create one of Australia’s leading Total TV, Audio and Digital platforms, with the scale, reach and diversification to better serve Australian audiences and communities. The combination of SCA’s and SWM’s leading brands on broadcast, audio and digital platforms establishes national leadership across the critical 25-54 ‘audience that matters’ demographic. The merged entity will offer partners and clients a ‘one stop shop’ for opportunities to reach this valuable audience across all mediums, leveraging shared content and commercial opportunities to add value beyond the initial cost synergy estimates,” said Mackay-Cruise.
All of this, naturally, is subject to regulatory approvals from ACMA, the ACCC and ASX.
The Scheme Meeting, at which SWM shareholders will vote on the proposal, is expected to be held once the required regulatory approvals are received, expected no later than Q1 CY2026.
