Ironbridge higher bid secures takeover

By John Drinnan, Christopher Niesche

Australian private equity firm Ironbridge Capital rushed to make a higher takeover bid for the remainder of MediaWorks after another Australian media owner tried to snap up minority shareholders' stakes.

Ironbridge yesterday achieved a full takeover of MediaWorks after making a new bid for the 17 per cent of the company it did not own at $2.68 a share - some 15 per cent higher than the previous bid at $2.33 a share.

Brook Asset Management agreed to sell its 8.7 per cent stake, taking Ironbridge's holding above 90 per cent and allowing it to compulsorily acquire the remainder of the shares - believed to be with retail investors - and delist the company from the stock market.

Brook - which banked an extra $6.8 million from the higher offer - yesterday confirmed that the potential debt loading under Ironbridge could have made "a difficult marriage between the two biggest shareholders".

It is understood an Australian media owner approached Brook about buying its stake in the company last week.

The suitor is believed to have been aiming to win a blocking stake of 10 per cent or more before trying to force Ironbridge into a joint venture on the television and radio company.

The identity of the potential buyer is not known, although Macquarie Media and PBL Media - a joint venture between James Packer's PBL and private equity firm CVC Asia Pacific - are possibilities.

PBL Media is understood to have offered CanWest around $2.60 a share for MediaWorks. But that offer was turned down in favour of Ironbridge because it was conditional on winning 90 per cent of shares.

Ironbridge Capital New Zealand operating partner Kerry McIntosh would not say whether other parties had been interested in the Brook shares.

He said the original offer of $2.33 had been fair and he repeated assertions that Ironbridge had been comfortable with retaining less than 90 per cent and MediaWorks remaining publicly listed.

Private equity companies typically invest in companies for three to five years but McIntosh did not rule out a longer-term shareholding for MediaWorks.

He expected it would be "business as usual" at the broadcasting company that owns TV3, C4 and half New Zealand's radio stations including RadioLive, More FM, The Rock, The Edge and The Breeze.

After Ironbridge took over CanWest's controlling stake MediaWorks chief executive Brent Impey gave the go-ahead for management to push ahead with a new breakfast show on TV3 called Sunrise.

Free-to-air television channels such as TV3 and C4 face extra competition for advertising revenue.

McIntosh says: "One of the challenges for us is that there are a lot of structural changes in the market and that is what makes it both interesting and challenging.

"We like the asset and there is nothing to stop us from holding on to it for a long time."

Brook executive chairman Simon Botherway insisted his company did consider holding on to its stake.

"If you look at average price they have got the cheapest media business in Australia," he said.

Asked whether Brook had set the $2.68 price early in negotiations, Botherway said there was "some to-ing and fro-ing".

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