Australian broadcaster to buy MediaWorks in $130m deal

Australian broadcaster Sports Entertainment Group Limited (SEG) has reached a $130 million deal to acquire New Zealand-based MediaWorks. The acquisition aims to create a dominant trans-Tasman audio, digital, and entertainment business. MediaWorks, a prominent New Zealand radio and digital audio company, owns popular commercial radio brands like The Rock, More FM, and The Breeze, alongside the Rova digital audio platform.

With approximately 2.4 million weekly listeners and a 59% audience share in the 25-to-54 demographic, MediaWorks is described as New Zealand's top audio business. The deal will combine SEG and MediaWorks' weekly audiences, totaling over 5 million listeners across both countries. SEG's CEO, Craig Hutchison, emphasized the transformational impact of the acquisition, stating it would grant immediate market leadership in New Zealand and provide a strong content foundation for expanding their sport, digital, and entertainment capabilities.

The current MediaWorks management team, led by CEO Wendy Palmer, will continue overseeing the New Zealand operations post-acquisition. The purchase price is based on an enterprise value of NZ$130 million, excluding cash and debt. SEG forecasts MediaWorks to generate NZ$25.4 million in EBITDA by 2026, with potential growth to over NZ$38 million by 2030.

The deal is anticipated to boost earnings per share before synergies. Funding for the acquisition will come from existing cash reserves, new bank borrowing, and an equity raising. SEG has launched a placement to raise up to A$11.7 million and plans a share purchase plan to raise up to A$2 million. The transaction is expected to close on October 1st, pending customary conditions, including approval from New Zealand's Overseas Investment Office.