NZME's bid to buy rival Stuff is heading to the High Court as it locks horns with Stuff's Australian owner amid an increasingly bitter process.
NZME – owner of the NZ Herald - has applied to the High Court at Auckland for an interim injunction against ASX-listed Nine Entertainment to enforce exclusive takeover negotiations.
The move follows an exchange of statements earlier this week after NZME filed an urgent Commerce Commission application to purchase Nine's New Zealand media assets for a nominal sum of $1.
Nine responded with a statement saying the parties had withdrawn from the bid last week and had terminated talks.
• NZME seeks urgent approval, help to buy Stuff for $1 'to help save jobs, newspapers'
• NZME shareholders urge break-up and vote on Stuff takeover
• Act leader David Seymour says the Government should allow NZME and Stuff to merge
• Pattrick Smellie: Has Nine told the government that Stuff is on borrowed time?
NZME hit back, saying it still had exclusivity and is now taking legal action to enforce it.
A hearing on the interim injunction is set down for tomorrow.
In a statement to the Herald, an NZME spokesman said the company did not accept that exclusivity had been validly terminated.
"NZME has filed an application for an interim injunction against Nine Entertainment Co Holdings Limited seeking orders to enforce this binding agreement entered into between NZME and Nine on 23 April 2020."
NZME has spent the best part of five years attempting to buy Stuff but has previously been declined Commerce Commission clearance.
It says the media landscape has been so wildly impacted by Covid-19 and foreign digital giants such as Facebook and Google that it is the best owner in order to save newspapers and journalism jobs.
"NZME's proposed acquisition of Stuff is important to the continued operation of a robust fourth estate and plurality of voice in this country," NZME told the NZX on Monday.
NZME and Stuff own most of New Zealand's daily metropolitan and regional mastheads. As well as the NZ Herald, NZME owns the Northern Advocate, Bay of Plenty Times, Hawke's Bay Today, Rotorua Daily Post and Whanganui Chronicle.
Stuff's stable includes the Sunday Star-Times, The Press in Christchurch and the Dominion Post in Wellington.
In a letter to Broadcasting Minister Kris Faafoi on Monday, NZME chairman Peter Cullinane and CEO Michael Boggs said NZME fully respected the commission's processes and "will see our application through if possible".
"The significant obstacle we face is that there is insufficient time to do so given the extraordinary conditions the industry finds itself in. We are mindful of what happened to Bauer Media and we are focused on saving hundreds of jobs and regional mastheads which may be lost if we do not act with this urgency. Time is of the essence and we seek your urgent assistance to allow completion by 31 May 2020."
The Herald reported yesterday the Commerce Commission was waiting for more information from NZME before publishing the new application.
"We're seeking further information from the applicant before we can register it," a Commerce Commission spokesperson said.
The Herald understands Nine is not comfortable with the full contents of the application being made public.
NZME is urging the Government to legislate to overturn the Commerce Commission's original decision to turn down a merger in the face of growing pressure in the media industry.
The regulator ruled in 2017 that allowing the companies to merge would diminish media plurality and concentrate too much power in a single organisation.
However, the decision has long been controversial, with many critics saying it didn't place adequate emphasis on digital tech companies - Facebook and Google - competing for advertising dollars with media companies.