The article below was published in the Weekend AFR. Investors...

The article below was published in the Weekend AFR.

Investors should not underestimate the strength of the relationship between Murdoch and Bruce Gordon who currently owns just under 20% of Prime Media Group.

Murdoch is only interested in low debt no debt media companies. Perhaps PRT will meet that criteria very soon.

Interesting times for all shareholders.

News Corp takes pitches to acquire Seven West Media, but debt a concern

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Seven is aggressively cutting costs and reducing debt to take part in media consolidation. Ian Waldie
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by Max Mason

News Corporation fielded a number of pitches from investment bankers to acquire Seven West Media, but the Rupert Murdoch-controlled media conglomerate decided against pursuing a deal for now due to the free-to-air broadcaster's debt burden.
The publisher of The Wall Street Journal and The Australian remains keen on free-to-air television and the potential advantages it could give News Corp's portfolio of publishing, digital and subscription TV assets, as well as chairman Lachlan Murdoch's radio investment Nova.
Mr Murdoch was part of a joint-bid for Network Ten with Bruce Gordon, but the pair were ultimately beaten by US studio giant CBS.
After missing out on Ten, News Corp had a close look at Seven after it was approached with potential deal structures by investment banks in the last six to eight months. Sources close to the situation said the approaches were unsolicited and not from from banks representing News Corp, although they were seriously considered.
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News Corp has long seen the benefits of adding free-to-air television to its portfolio.
One of the plans worked on was a scrip offer where Seven would have been merged into News Corp and existing shareholders in the free-to-air network would have been given new shares in the Rupert Murdoch run business.

One of key reasons News Corp decided against pursuing a deal with Seven was its debt level of $710.8 million as of December 31.
News Corp made no formal approach or offer for the broadcaster, however sources said it could reconsider should Seven continue on its path of reducing debt and cutting costs.
News Corp and Seven declined to comment.
In February, the metropolitan network suspended its dividend to pay down its debt so it could take part in any potential industry consolidation.

"When something does come along that makes sense for us, we want to make sure we're in the best position to take advantage of it," Seven chief executive Tim Worner told The Australian Financial Review in February.
Seven has been aggressively searching for cost savings, adding a further $20 million onto its annualised savings target by the end of 2018-19, taking the total to $125 million. The exception to this initiative is Seven's newly acquired Cricket Australia broadcast rights, which will cost about $90 million per annum, including rights fee and production cash cost. But the network expects to capture a greater share of advertising revenue because of the cricket acquisition.
At the Macquarie Bank conference earlier this month, Mr Worner said the broadcaster remains on target to reduce its debt to circa $650 million by the end of the financial year.
At News Corp's third quarter results on Friday, chief executive Robert Thomson, when asked broadly about potential transactions, said "we're constantly reviewing our situation and opportunities that may or may not arise. What we certainly won't be doing is paying silly money for overpriced, overhyped targets ... we'll certainly always have shareholders in mind when contemplating any investment."

Seven Group Holdings chief executive Ryan Stokes fuelled speculation Seven West could be part of industry consolidation bringing television and newspapers together at the Macquarie conference on May 3. Seven Group owns just under 40 per cent of Seven West.
"That scale advantage is real; when you've got an ability to leverage audiences across platforms, there are efficiencies, in any deal the synergies have to be there on the cost side but also, how can you leverage that audience across multiple platforms and how do you use the promotional power of TV across different environments," he said.
"For us it's worked well in the west and that model of a combined newsroom works well, it delivers results, we think there are more opportunities."
Seven West shares are up 25.4 per cent since the day of Mr Stokes' presentation. The day prior Fairfax Media chief executive Greg Hywood signalled his openness to media consolidation, should the right opportunity arise. Fairfax has previously been linked to Seven. However, sources said the two companies are not in merger talks.