Fairfax Media Limited’s (ASX: FXJ) stock skyrocketed 8.7 per cent on July 26, 2018 after the announcement that Nine Entertainment Co. Holdings Limited (ASX: NEC) and Fairfax entered into a scheme implementation agreement under which both companies will merge to establish Nine as one of the leading independent media companies in Australia. As per the agreement, Fairfax shareholders will get scrip consideration of 0.3627 Nine shares for each Fairfax share held and $0.025 cash consideration per Fairfax Share. Of which, Nine’s shareholders will hold a 51.1% stake in the combined entity, while FXJ’s shareholders will claim the rest 48.9% interest. According to the deal, the combined entity will be headed by Mr. Hugh Marks (Nine’s Chief Executive Officer). The combined entity will also invite three Fairfax Directors to join the Board of the consolidated business, which will be led by Nine Chairman, Mr. Peter Costello and further incorporate two Nine’s directors into the combined business. Through this deal, the combined business will expand its portfolio size through incorporating Nine’s free-to-air television network, digital business portfolio i.e., Domain, Stan, and 9Now, and Fairfax’s media portfolio. The proposed transaction will be subjected to shareholder and other approvals.
Fairfax Media Limited traded at a market price of $0.837 with the market capitalization of circa $ 1.77 Bn (AEST: 03:30 P.M.)
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