Rural Press eyes Fairfax NZ

Rural Press, publisher of the Canberra Times, may look at buying the New Zealand, regional and business publications of John Fairfax Holdings should the rival be broken up when media law changes take effect next year, chief executive officer Brian McCarthy said yesterday.

The company could also look at the larger competitor's newspapers in New Zealand as part of a group of investors carving up Sydney-based Fairfax, McCarthy said.

"We would be interested in certain assets should a break-up of Fairfax occur," McCarthy said. He said there were no concrete plans, or talks with buyout firms. Rural Press hasn't bought a stake in the publisher yet to gain bargaining power.

Australia's Senate has just passed laws allowing foreign investors to buy Australian media assets and letting companies own more than one form of media in a single-city market. Scrapping a 19-year ban on cross-media takeovers and foreign ownership, the laws may spark more than A$6 billion ($6.8 billion) in media takeovers, analysts have said.

Fairfax, whose mastheads include the Sydney Morning Herald and Melbourne's Age, may be the most imminent target because it lacks a large strategic investor, according to media analysts at Merrill Lynch and Macquarie Bank in Sydney.

Scrapping foreign media ownership restrictions could also attract international media companies and buyout firms, which have started circling Australia with bids for companies including Coles Myer and DCA Group.

Fairfax has a market value of A$4.5 billion, compared with Rural Press at A$2.31 billion.

McCarthy said Rural Press would be interested in Fairfax's regional newspapers but not the metropolitan mastheads with their falling classified advertising revenue.

- BLOOMBERG