New Zealand’s biggest media company, NZME, has offered to buy media rival Stuff for $NZ1 in a reboot of the “StuffMe” merger.
In a statement to the New Zealand stock exchange on Monday morning, NZME announced its proposal to acquire Stuff, owned by Australian media company Nine.
However, Stuff chief executive Sinead Boucher declared the offer “very surprising to both Nine and ourselves” in a company-wide email sent on Monday morning and obtained by Australian Associated Press.
Boucher said the two companies had been in talks until last week, when Nine terminated the discussions without a deal.
“We are really not sure why NZME took this step, given the clear message from our owners that there would be no transaction,” Boucher wrote. “There is no deal between NZME and Nine.”
Nine and previous Australian owner Fairfax had been attempting to offload the media company for years.
The NZ Commerce Commission knocked back a merger between NZME and Stuff in 2017.
Now, NZME has asked the competition regulator for urgent clearance to allow the sale.
In its NZX statement, the NZME board said: “consolidation is urgent in the face of dramatically declining advertising revenue and current general economic conditions”.
“NZME continues to believe that it is the best owner for Stuff as it is best placed to preserve mastheads, newsrooms and jobs.
“NZME’s proposed acquisition of Stuff is important to the continued operation of a robust fourth estate and plurality of voice in this country.
“If approved, the acquisition should lower the costs of producing New Zealand news by combining NZME and Stuff’s business operations, with those savings supporting the future of New Zealand journalism by a local, committed national news media outlet.”
NZME owns Auckland masthead the New Zealand Herald, as well as a string of radio stations, regional newspapers and other media entities.
Stuff is the country’s most popular news website and biggest employer of journalists, publishing Wellington’s Dominion Post and Christchurch’s The Press among other titles.
Both companies have engaged in cost-cutting during the coronavirus pandemic, with NZME announcing 200 redundancies last month.
In February, NZME posted a $NZ165m loss amid writedowns.
NZME’s share price soared 19% to 26 cents in early Monday trading.