HWT board recommends increased News offer

Press, 12 January 1987, Page 27

HWT board recommends increased News offer

PA Sydney The media tycoon, Mr Rupert Murdoch, dramatically raised his offer for Australia’s largest media group in an attempt to shake off a stiff challenge from Mr Robert Holmes a Court the country’s richest man. Murdoch’s latest bid of sAust2.3 billion for the Herald and Weekly Times (HWT) topped Mr Holmes a Court’s offer by $2OO million.

The Herald and Weekly Times Board has recommended shareholders accept the latest cash bid by Mr Rupert Murdoch’s News Corporation, of $l5 a share. A statement said HWT directors had considered the revised offer and proposed to recommend to shareholders that they accept it, in the absence of a more attractive offer from Mr Robert Holmes a Court’s J. N. Taylor Holdings, Ltd. Stock market analysts described Murdoch’s offer of $l5 for each HWT share as stunning, but said the see-saw battle for the group was far from over.

The new offer coincided with a temporary injunction from the Supreme Court in Melbourne to restrain Murdoch’s News Corporation from holding more than 15 per cent of the HWT.

Mr Holmes a Court sought the order on the ground that under the Broadcasting Act Mr Murdoch, Australian-born but now an American citizen, cannot hold more than 15 per cent of any broadcasting organisation. The case will be heard on today.

HWT controls 14 metropolitan newspapers in five state capitals and television stations in Melbourne and Adelaide. Market analysts say News Corp will gain control of 75 per cent of the Australian media industry if its takeover succeeds.

Mr Murdoch, owner of the world’s largest media empire, had originally offered $l2 a share with scrip alternatives, but Mr Holmes a Court won the HWT board’s support with a counter-bid of $13.50. Mr Murdoch, who left for Auckland on his way to Los Angeles on Tuesday, returned on Friday to make a surprise appearance at a board meeting of the Brisbane-based Queensland Press, which owns a strategic 24 per cent of HWT. Details of the meeting were not disclosed.

Queensland Press has been the take-over target of a rival newspaper organisation, John Fairfax. Mr Holmes a Court has said he would modify his take-over documents to accommodate Fairfax.

Mr Holmes a Court was not immediately available for comment, but officials of his Bell Group said the entrepreneur would announce his next move soon.

The Trade Practices Commission (TPC) has agreed to permit News, Ltd, to despatch its takeover offers for The Herald and Weekly Times, Ltd, after undertakings by News to sell certain newspaper interests if the bid succeeds. In a statement it said News has agreed to sell Brisbane newspapers, “The Sun” and “Sunday Sun” and “Adelaide's News” if it acquires more than 40 per cent of HWTs issued capital. As well, the TPC said, News has agreed to arrange for HWT to sell HWTs Perth newspaper “The Daily News” should it acquire more than 40 per cent of HWT. The TPC’s requirements follow concerns that Mr Murdoch’s News group would dominate newspaper markets in Brisbane, Adelaide, and Perth should its bid for Australia’s oldest and largest media group succeed.

Control of HWT would give Mr Murdoch the Brisbane newspapers, “The Courier Mail,” “The Telegraph,” and the “Sunday Mail.” In Adelaide, HWT controls the “Adelaide Advertiser” daily newspaper through its 50 per cent owned Advertiser Newspapers, Ltd, while in Perth, News already has the dominant Sunday newspaper, “The Sunday Times.” The TPC said the sales are to be made to a purchaser or purchasers and on terms approved by the commission.

As well, the TPC said it would need to be satisfied that the purchaser or purchasers would experience profitable operations from the newspaper properties and would be able to offer effective competition to other newspapers with which they compete. “If these sales are not completed within the specified period the two Brisbane newspapers, the Adelaide newspaper and the Sunday Times in Perth, will be sold within a further specified time by a trustee who has been appointed for the purpose,” the TPC said.

The TPC said News’ undertakings are incor-

porated in a deed executed under the common seals of both News, Ltd, and its parent company News Corp, Ltd. The deed also provides for an approach to be made to the Federal Court of Australia for consent orders and directions to secure divestiture. The TPC said the deed contains additional assurances sufficient to satisfy the commission that the undertakings can and will be performed within the agreed time periods.

“In the circumstances and subject to the performance of the undertakings the Commission will not take steps to prevent the takeover.” it said.