$40million Bauer Takeover Of Pacific Magazines Gets The Go-Ahead
Bauer Media has been given the greenlight by the ACCC to acquire Pacific Magazines.
The $40 million deal will see Bauer Media, which is part of the Germany-based Bauer Media Group, purchase Pacific Magazines, a wholly owned subsidiary of Seven West Media Limited (SWM).
Completion of the sale is expected to take place on the 9th of April 2020.
“We welcome today’s regulatory approval of the sale of Pacific Magazines to Bauer Media,” and Managing Director of Seven West Media James Warburton said this morning.
“This transaction provides $40 million in cash consideration (pre-adjustments and leave provisions). Additionally, the $6.6 million of advertising we are receiving from Bauer over three years enhances the value of the sale, allowing the titles to continue to reach the valuable audiences SWM commands.”
SWM has said it will maintain a relationship with Bauer Media for the ‘Better Homes and Gardens’ magazine through its successful TV show under the same title.
The takeover was lodged with the ACCC last October. The ACCC’s investigation was primarily concerned with the competition in entertainment content (between Bauer’s ‘Woman’s Day’ and Pacific Magazine’s ‘New Idea’), real life and puzzle content (that is, Bauer’s Take 5 and Pacific Magazine’s ‘That’s Life’) as well as the acquisition of photography, particularly exclusive celebrity photography.
Although the two publishers overlap and compete, the ACCC decided that this content is also available elsewhere.
The ACCC also noted the tough times for publishers generally, and stated that the merging of the two companies would not be a significant contributor to this.
“We note that some magazine titles have already closed, and others are likely to follow, regardless of this deal,” ACCC Chair Rod Sims said.
SWM’s share price on the ASX was up 8.7% this morning following the announcement.