Prime ends Argentina foray

Brisbane-based Prime Television has sealed a deal to get out of its disastrous investment in Argentina, and focus more on its Down Under interests.

Prime will receive $US67.5 million ($161.5 million) after finalising the sale of its 50 per cent stake in Azul Television.

This will be used to reduce the company's debt to below $A100 million ($124.07 million).

Prime chairman Paul Ramsay said it was unfortunate that the company's decision to invest in Argentina coincided with the South American country entering a serious economic downturn.

"Now that this chapter is closed for Prime, directors are confident that the company's worth can be better appreciated," he said.

"The company's focus is now on our New Zealand investment and on consolidation of our core Australian business."

Brokers said the higher than expected price for Azul - $A130 million as opposed to $A108 million - was lifting Prime's shares.

One Brisbane broker said: "It has been a long time coming but they have got the money in the bank now and can concentrate on their Australian operations a bit more, and not worry so much about reining in their debt."

Prime crawled back into the black with a net profit of $A855,000 in the second half of last year, despite suffering a loss from its coverage of the Sydney Olympics.

This compared with the previous year's $A2.517 million interim net loss.

The company's Australian operations reported a consolidated profit before tax of $A8.21 million, compared with the previous period of $A14.12 million profit.

Prime New Zealand general manager Warwick Syphers said the pullout from Argentina was positive for the New Zealand operations.

However, the move had increased speculation that the company would sell its underperforming Prime NZ assets.

British media group West 175 Media has been tipped as the leading contender.

Mr Syphers said: "As a public company, if we had a transaction proposed - or in train - we're required to report that to our home exchange.

"There's nobody else. It's still early days for Prime NZ and that result in Argentina bodes well for the company and its ability to support its investment here," he said.

Prime's NZ business reported a consolidated operating loss before tax of $A5.7 million compared with a loss of $A5.2 million 12 months earlier.

In Australia yesterday, Prime shares soared to their highest level in nine months on news of the Argentina exit, finishing up 10c at $A1.95.

- NZPA