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This was published 9 years ago
Bauer's global ambitions lead to hunt to buy Murdoch's Nova
By Dominic White and Max Mason
Bauer Media Group is eyeing an entry into Australia's $1 billion radio market after making repeated efforts to buy Lachlan Murdoch's Nova Entertainment, operator of the Nova and Smooth FM networks.
Fairfax Media understands that the German media giant made several approaches to Mr Murdoch's Illyria in 2014 and made an indicative offer of around $450 million, which was rejected.
Lachlan Murdoch's Nova Entertainment has rejected repeated overtures by Bauer Media.Credit: Bloomberg
It is understood that those talks ended last year but industry sources say Bauer continues to examine options for expansion into radio in Australia, a move which could take some pressure off its struggling print assets.
Bauer has had a difficult time here since it acquired the country's largest magazine publisher, ACP, home of The Australian Women's Weekly, from Nine Entertainment Co for $525 million in 2012.
It has shut down several ACP titles including Women's Fitness, Madison, Grazia and last month, the lad's mag Zoo Weekly.
Global ambitions
Bauer has global ambitions in commercial radio, which is growing strongly in Australia and proving more immune than other traditional media such as print and television to the digital revolution.
The Hamburg-based group became Europe's largest radio broadcaster in July when it completed the acquisition of Nordic radio broadcaster SBS Discovery Radio, the market leader in Sweden and Denmark, and number two in Norway and Finland.
Announcing that deal, the group's fifth generation global chief Yvonne Bauer said: "Together with print and online, radio is an important business field for the Bauer Media Group."
Bauer chief executive David Goodchild said the company did "not comment on media speculation".
Illyria paid about $112 million for half of the business from the Daily Mail and General Trust in 2009 when it recorded earnings before interest, tax, depreciation and amortisation of $16 million. Illyria took full control of the business in 2012 for a reported $100 million.
The company's EBITDA is now thought to be in the high $60 million-range, which would put its value at more than $500 million based on a multiple of eight or nine times earnings.
Speculation
Together with print and online, radio is an important business field for the Bauer Media Group.
Yvonne Bauer, Bauer Media Group
The competition regulator is due to announce its final decision on that proposed deal on October 22. It has expressed concerns that Mr Murdoch is also co-chairman of News Corp, which owns half of Foxtel.
It has also noted that the Australian Communications and Media Authority is examining whether the deal breaches cross-media ownership restrictions. If the ACMA were to find a breach one solution for Mr Murdoch could be to sell Nova.
A spokesman for Illyria told Fairfax Media: "Nova is not for sale".
Nova CEO Cathy O'Connor declined to comment when asked about the approaches by Bauer.