The New Zealand Press Association, which has supplied news to newspapers for more than 130 years, faces closure after one of its owners withdrew its support.

The Wellington-based news agency's 40 staff heard last night that Fairfax Media had given notice of pulling out of a co-operative ownership agreement with APN, publisher of the Herald, and independent newspaper companies.

NZPA's board announced a review of the agency's future, and a final decision is expected in a month.

APN, which also has daily papers in Whangarei, Rotorua, Tauranga, Wanganui, Hawkes Bay, Wairarapa and Oamaru, has agreed to work
with newspaper companies which run the Otago Daily Times, Gisborne Herald and papers in three South Island centres to form a new news

APN NZ chief executive Martin Simons said the company had been a longstanding shareholder and customer of NZPA but the agency's viability could no longer be assured.

He said the ending of the NZPA co-operative was a sad development for staff of the agency who had worked tirelessly covering New Zealand news for so long.

"We will have discussions with key NZPA staff and work with New Zealand's independent publishers to tailor a news service to meet the nation's content needs."

NZPA was founded in 1880, as the United Press Association, adopting its present name in 1942.

The agency's chairman, Michael Muir, said last night: "Whatever the outcome, there will be new opportunities and in some cases more competition."

Fairfax chief executive Allen Williams said his company had made a choice to invest internally, rather than subscribe to "non-exclusive content from NZPA".