Media personalities all part of the CanWest package

By PAM GRAHAM

TV3 personalities John Campbell and Carol Hirschfeld add to a $121 million brand valuation in CanWest's New Zealand share sale, but how much remains unknown.

The well-signalled share float will see Canadian media giant CanWest Global Communications taking profits on radio and television channels built up here over 13 years.

"We're by no means leaving the market, we quite like it here," said CanWest MediaWorks chairman Tom Strike.

The float prospectus shows the company values its radio and television brands at $121 million.

"We have not assigned a brand to any personality," said chief executive Brent Impey. But the news readers were an integral part of the TV3 brand and they were "locked in" because of it.

Impey has his own golden handcuffs - the company has to give two years' notice to terminate his contract and a payout for a change of control could be as high as $3 million.

The numbers of interest to investors, though, involve how well advertising is holding up. Impey said it was "looking firm" for the next two months.

Radio annual plan bookings were well ahead of last year and the company was anticipating firm demand for television for the final quarter of the calendar year.

It attributed a slight softening in advertising in May to worries about interest rate rises but since then economic news had been good and demand had been firm.

Impey disputed suggestions that CanWest was selling assets it had failed to exit through a trade sale and that the float was at the top of the advertising market.

"I don't think that is fair. I think it is fair to say that the sell down is occurring when we have completed the first phase of the turnaround of the TV business," he said.

He said CanWest could have sold the radio business at any time because its growth had been steady.

There had been buyers for the businesses separately but Impey and management argued they were worth more together.

"Now we're in a situation where CanWest can offload 30 per cent to 36 per cent, repatriate some money, and still be there as the major shareholder to participate in future upside," Impey said.

CanWest has C$3 billion ($3.5 billion) of debt according to Bloomberg News.

The sell down put a market value on the assets and allowed CanWest to take some money out. "Those two reasons are almost equal," said Impey.

Strike said the business had matured to a level "where we believe it should be in the market".

It has been a long road building a free-to-air channel competitor for state-owned Television New Zealand, which still has more than twice TV3's market share.

CanWest has a 45 per cent radio market share, equal to its rival The Radio Network.

Analysts view the television business as the more volatile.

In radio, the two main players had the same objectives, while in television they had different strategies, said Impey.

"It is about establishing your own position and being as true to that position as you possibly can," he said. TV3 targets 18- to 49-year-olds.

Impey said Australian investors had a good level of knowledge about the New Zealand media market and float presentations had been made to them. "We're heading into this process very confident."

CanWest also saw potential for small acquisitions. "We can't foresee anything of a medium size. If something is of a large scale, we would come back to shareholders," he said.

The float brings a welcome media stock to the share market but it follows a run of floats that have absorbed investors' money.

The offer

* Up to 36 per cent, 81.6 million shares, of CanWest MediaWorks.

* Price range: $1.50-$1.65 a share.

* Forecast dividend yield: 6.1 per cent ot 6.7 per cent.

* Offer opens today, closes July 21.

* Listing due July 29.