Change likely afoot at NZME’s NZ Herald as tycoon buys major stake

A trend by wealthy business people to buy publications to shift editorial direction could be moving to New Zealand.

A Canadian billionaire with aspirations to shake up the New Zealand press has begun his campaign to assert further influence at the $200m Australian and New Zealand-listed NZME, snapping up shares to amass a 9 per cent holding.

It comes with suggestions the company could be in talks with a top online real estate group about combining with its own business, One Roof, subject to a strategic review and a potential demerger, but more on that later.

DataRoom reported a fortnight ago there were rumblings across the Tasman over the state of the Kiwi media industry, with at least one wealthy resident, including a Canadian billionaire who resides in New Zealand, looking to get involved.

That wealthy investor is now known to be James Grenon, a private equity tycoon who owns Tom Capital with a track record of profiting through turnaround jobs on out-of-favour companies, including media groups.

A stock exchange announcement on Monday showed Mr Grenon has amassed 17.5m shares, equating to 9.321 per cent, in NZME, the publisher of the country’s largest daily newspaper, The New Zealand Herald, which has more than 2 million readers.

He outlaid about $NZ9m on February 28 to buy shares from Karori Capital and take his existing interest beyond 5 per cent.

Mr Grenon is recorded as a political promoter and has been linked to right-of-centre alternative media websites such as The Centrist and its sister site NZ News Essentials.

This column understands from various market sources that while it has been stated he was acquiring the shares for investment purposes, with no current intention to make a takeover bid, the motivation for the purchase is to assert greater boardroom influence.

Any move he might make to gain further control and have a say on the editorial direction of The New Zealand Herald comes amid a changing global media landscape, with wealthy billionaires asserting their influence to “de-woke the press”.

This includes the likes Tesla founder Elon Musk buying Twitter and renaming it X, while Amazon founder Jeff Bezos purchased The Washington Post.

Both have radically changed their editorial direction.

Mr Bezos claimed The Washington Post’s opinion pages would defend personal liberties and the free market in a shift which prompted WaPo’s opinion editor to resign, his publication reported.

He said viewpoints opposing those pillars would be left to be published by others.

It also comes with a right-of-centre Chris Luxon-led government in power in New Zealand and US President Donald Trump moving to dismantle politically correct policy in the US.

New Zealand’s mainstream media has come under fire for declining quality, but commentators and observers disagree on the reasons.

Media commentator and former New Zealand Herald editor in chief Gavin Ellis in an opinion article blamed staff cuts on the state of the company’s performance, and too much focus on clicks and computer algorithms.

Another media expert said the NZ Herald was “thoroughly eclectic” rather than left, but lightweight, lacking in value and focused on clickbait.

But, one New Zealand media observer described The New Zealand Herald as “a constant stream of left leaning stories smattered with overuse of Māori language such that many viewers and readers had simply turned off and checked out, and unfortunately, those were the ones that advertisers wish to target”.

Others have highlighted what they say is a clear lack of editorial direction, and that the paper should make a strong statement of what it stands for.

Shareholders have been disgruntled about its performance for some time as NZME reported a

$16m loss for 2024 following tough economic conditions.

Its results showed earnings before interest, tax, depreciation and amortisation went backwards for the period in digital, where 41 per cent of revenue was from New Zealand Herald subscribers, and print publishing.

Overall, it has 236,000 subscribers.

Shareholders have taken the view that better quality content would drive higher earnings and NZME said in its results it would move to “improve the tone of the conversation to build positive momentum for all New Zealanders … to support the reboot … of New Zealand’s economic recovery”.

NZME also owns successful radio stations, such as conservative talkback station Newstalk ZB — following a media company merger several years ago —, and a raft of other publications.

Meanwhile, speculation is mounting the company has aspirations to de-merge its One Roof online real estate business, the number three player in the market, and potentially use shares to buy dominant rival realestate.co.nz, which is said to be up for sale by its real estate agent owners.

It announced a strategic review of One Roof through investment bank Jarden.

Another possible outcome is that the company is purchased by industry heavyweights like CoStar or Trademe.

New Zealand tycoon Nick Mowbray, who owns consumer products company Zuru and reportedly donated to New Zealand’s right of centre Act Party, was understood to have earlier contemplated an investment in NZME, but opted against a move.