Prime Media investors vote yes to Seven’s $132m takeover

Prime Media shareholders have voted to take the money after chair Cass O’Connor urged a weigh up of ‘certain cash return vs uncertain future returns’.

Prime chairman Cass O'Connor has highlighted the choice before shareholders. Picture: Hollie Adams

Prime Media shareholders have delivered an expected resounding yes vote to a $132m takeover by Kerry Stokes-backed Seven West Media with about 99.9 per cent approving the deal.

The short meeting saw chair Cass O’Connor reiterating the board’s support for the deal with Seven Network, urging shareholders weigh up “certain cash return vs uncertain future returns”.

On Thursday, Ms O’Connor, who became chair in October, reminded shareholders the regional broadcaster’s deal with SWM subsidiary Seven Network – a long time broadcast partner – comes amid “structurally difficult operating environments coupled with the looming renewal of its program supply agreement with Seven and revenue diversification strategy”.

About 99.9 per cent shareholders voted yes to three related resolutions, which sees Seven acquire all of Prime’s assets and staff with Prime handing cash from the deal and $10m in the bank to shareholders as a 36c per share payout.

Ms O’Connor concluded the meeting saying the yes vote marks “the closure of an important and influential chapter in Australian television”.

“It is an overwhelmingly positive outcome for shareholders both at Prime and Seven,” she said in a statement issued later.

The vote came after shareholders were told an independent expert’s ongoing opinion of the transaction was that it was fair and reasonable and in the best interests of shareholders, in the absence of a superior proposal since the bid was made in November.

Prime CEO Ian Audsley said the deal offered continuity for staff under Seven. Picture: Hollie Adams.

About 43.2 per cent of existing shareholders had indicated their support for the takeover prior to the meeting.

The Australian Competition and Consumer Commission approved the takeover on December 9.

The passed resolutions include a name change to PRT Company Limited, which will subsequently be wound up by the deal’s estimated completion timeline of February.

Seven’s win comes after an earlier $64m offer was rejected two years ago.

“They do a great job in news,” Seven CEO James Warburton has said of Prime’s local broadcasts. “We’ll be looking to expand this and getting more news resources in the regions.”

Seven will target savings of between $5m and $10m and offer advertisers an audience reach of almost 23 million regional and city-based Aussies.

At last month’s annual general meeting, Prime chief executive Ian Audsley said the “evidence is clear that digital disruption wrought by international companies has had an irreversible and negative impact on regional Australia’s traditional media businesses, the level of local content created, and local media job opportunities”.

Over the past seven years, Prime had sought legislative reforms for the regional television sector which would enable it to achieve the necessary scale to compete with digital platforms and network broadcast video on demand services, but was unsuccessful.

“The proposed transaction with Seven facilitates continuity for Prime stakeholders, including

advertisers and some 330 staff, in a much larger, scaled media business …”

Prime Media shares are up nearly 0.5 per cent at 44c at noon AEDT but Seven West Media fell 0.8 per cent to 61c.