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ACCC clears $200m Fairfax/Macquarie radio merger
By Jared Lynch
A $200 million merger of John Singleton's Macquarie Radio Network with Fairfax Media's radio business has stepped closer to fruition after the competition watchdog approved the deal.
The Australian Competition and Consumer Commission's chairman Rod Sims said the venture, which will combine top rating stations MRN's 2GB in Sydney and Fairfax's 3AW in Melbourne, would "continue to face strong competition from other commercial radio stations".
Combining 2GB - home of shock jock Alan Jones - with Fairfax's talkback station 2UE would help the radio network serve "the older demographic in Sydney," the ACCC says.Credit: Andrew Meares
"The ACCC considered the effect of the proposed transaction on the price of radio advertising, as well as the quality of news and other content provided to audiences," Mr Sims said.
The deal is still subject to shareholder approval and MRN offloading its 2CH radio station in Sydney plus eight regional stations in Queensland to satisfy media ownership laws.
Mr Sims said combining 2GB - home of presenters Alan Jones and Ray Hadley - with Fairfax's Sydney talkback radio station 2UE would "provide MRN with a particularly strong position in serving the older demographic in Sydney", and despite being rivals, would not hinder competition in that market.
"While few other commercial radio stations currently operate the same talkback format as 2UE and 2GB, other radio stations would be able to change their format and programming to include more talkback if it made commercial sense to do so," Mr Sims said.
He said the ACCC spoke with advertisers, advertising agencies, consumers and other radio stations and networks to reach its decision.
The merger will involve MRN acquiring 100 per cent of Fairfax Radio Network's share capital in exchange for the issuance of new Macquarie ordinary shares, plus $18 million cash.
Fairfax, the publisher of BusinessDay and The Australian Financial Review, would own 54.5 per cent of the shares in the new business, with Macquarie holding the remaining 45.5 per cent.
An MRN shareholders' meeting has been scheduled for March 25. The company has engaged its former managing director Rob Loewenthal to sell 2CH and its Queensland stations.