CanWest plans share sale

By PAUL PANCKHURST

CanWest plans to have its New Zealand television and radio business - spearheaded by TV3 - listed on the stock exchange before the end of July.

As well as TV3, it has music television channel C4 and the More FM and RadioWorks networks.

The Canadian media group will hold on to a majority stake, leaving open the possibility of a full exit by stages.

The Business Herald understands CanWest could make up to $200 million from a partial sale.

The company is expected to retain at least a 51 per cent shareholding.

One view is that the value of the business - including debt - is likely to be higher than $600 million.

The float will come 13 years after CanWest bought into TV3, then a fledgling channel in receivership.

Less than two years ago, it called off efforts to sell the New Zealand operations to a trade buyer.

Goldman Sachs JBWere - the broking and investment banking firm that handled the aborted trade sale - is expected to advise on the float.

The More FM radio network includes More FM, Channel Z and The Breeze.

RadioWorks includes Solid Gold FM, Radio Pacific, The Rock, The Edge and a network of local stations.

In November last year, CanWest's then-president and chief executive, Leonard Asper, told analysts that an offering of shares was on the cards.

CanWest would keep control "but potentially repatriate a couple of hundred million dollars".

CanWest's interests in Canada, New Zealand, Australia, Ireland and Britain cover newspapers, television, radio and outdoor advertising.

Media companies are riding high because of the strong demand for advertising.

TVNZ this week reported that last year's "unprecedented" demand for advertising time had continued.

The outlook for CanWest's New Zealand operations this financial years is believed to be for earnings before interest, tax, depreciation and amortisation of $50 million to $60 million.

In the first quarter - the three months to November 30 - the television and radio operations reported increases on the year-ago ebitda figures of 36 per cent and 32 per cent respectively.

The television business turned around last financial year after previous operating losses.

The loss-making TV4 was relaunched in October last year as C4, a music channel with lower production costs.

CanWest paid $6.3 million in December for one of two Auckland FM frequencies put up for auction by the Government.

CanWest NZ

Television TV3, C4, Property TV.

Radio More FM (More FM, Channel Z, The Breeze); Radio Works (Radio Pacific, The Edge, The Rock, Solid Gold, local radio).