Australia's APN News & Media is expected to make an announcement this morning that may include a capital raising and plans to separate its New Zealand business - NZ Herald publisher NZME - to form a standalone operation. Australian media have speculated that APN and rival Fairfax are in early exploratory talks about a merger of their New Zealand businesses. Any such deal would be subject to New Zealand Commerce Commission approval, and the process would be lengthy, analysts said. The APN board met today and the company's plans will be disclosed to the ASX ahead of today's annual meeting in Sydney, due to be held at 11.30am New Zealand time. Fairfax Media publishes the Sydney Morning Herald and the Australian Financial Review. Media reports, including in the Australian, said Fairfax Media wants to spin off its New Zealand business, which includes mastheads the Dominion Post and the Press. Fairfax, in a statement to the ASX, said on Monday that it was exploring options for all its businesses, including those for Fairfax New Zealand. The same day, APN asked the ASX for its shares to be put in a trading halt "pending the release of an announcement concerning a potential material transaction by APN in relation to APN's New Zealand business, NZME". One fund manager, who did not wish to be identified, said both Fairfax and APN were looking at their structures because their respective shares were trading at levels that were beneath the sum of their constituent parts. "It would appear that there would be significant costs and revenue synergies of NZME and Fairfax NZ being put together," he said. On competition grounds, he said the definition of 'market' would be a lot wider than just printed newspapers, given the big changes that have occurred in the media over the last few years. Conversely, a narrow definition of "market" would rule such a deal out, he said. Australian media speculated that the demerger, along with APN's sales of its Australian regional publishing assets, would allow APN to focus on the radio and outdoor advertising market - sectors that have enjoyed an upward trend on advertising revenue. Rupert Murdoch's News Corp has been touted as one of the potential buyers for APN's regional assets. In addition to the Herald, NZME owns several provincial newspapers and radio stations, including Newstalk ZB and Radio Hauraki. APN News & Media abandoned plans for an initial public offering of its NZME division in February. Speculation circulated last month that APN would launch an in specie share distribution plan to split off NZME shares, which would allow APN shareholders to sell or retain their exposure to New Zealand. Last week, Fairfax Media flagged the possibility of at some stage ending weekday print editions of the Sydney Morning Herald and the Age due to falling ad revenue.