Fairfax Media's proposed merger with John Singleton's Macquarie off the table
Ray Hadley Photo: Ben Rushton
Fairfax Media's $200 million radio merger talks with John Singleton's Macquarie Radio Network have collapsed after it became clear that star Macquarie presenters Alan Jones and Ray Hadley were not prepared to be part of the proposed deal.
It is the second breakdown in two years of talks over a combination of Fairfax's top-rated Melbourne station 3AW with Macquarie Radio's 2GB, the home of Jones and Hadley.
The joint venture would have controlled leading talkback stations in all the mainland capital cities except Adelaide, making it a stronger proposition to sell to advertisers, and would have had earnings of $32 million before interest, tax, depreciation and amortisation.
Alan Jones
The news follows last week's move by APN News & Media to take control of its radio assets for $246.5 million in a move that creates three clear owners for Australia's main FM stations: APN, Southern Cross Media Austereo, owner of the Today and Triple M networks, and Lachlan Murdoch's DMG, owner of the Nova and Smooth networks.
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It is understood that Jones and Hadley - Macquarie's top talent - could not be persuaded to become part of a joint venture controlled by Fairfax.
Both sides blame the other for failing to secure the support of Jones and Hadley, but there is broad agreement their conservative views were a "difficult fit" with Fairfax's more liberal mastheads, The Sydney Morning Herald and The Age. Hadley and Jones also regularly appear in the news pages of the Herald. It is understood Fairfax had hired investment bank Macquarie to work on the joint venture idea and that both sides saw a strong commercial logic to a potential deal. 2GB dominates talkback in Sydney, where Fairfax's 2UE is weak, but Fairfax's radio stations are better rated elsewhere, led by Melbourne's 3AW and including Brisbane's 4BC and Perth's 6PR.
Analysts said a merged entity could have saved between $5 million and $10 million in costs but that the greatest benefit would have been a national network to sell advertising across the country, with revenue synergies estimated at $15 million or more.
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Fairfax Media's proposed merger with John Singleton's Macquarie off the table