TVNZ sells stake in news agency

Press, 20 February 1988, Page 33

TVNZ sells stake in news agency

The Broadcasting Corporation has been paid about $2.6 million for most of its shares in the world’s largest television news agency, Visnews.

But the chairman of the corporation, Mr Hugh Rennie, said in London that Television New Zealand would retain strong links with Visnews. Visnews would continue to provide New Zealand with satellite television news material, while it would also continue to take New Zealand Television news material and distribute it throughout the world. The sale of the shares was part of a deal in which the news agency Reuters increased its holding in Visnews from 55 per cent to almost 90 per cent. The restructuring of Visnews, which was begun as a partnership between the 8.8. C. and the public

broadcasting corporations in Australia, New Zealand and Canada, along with Reuters, has been under negotiation for the last two years.

Under the new arrangements, the 8.8. C. and Reuters will be the only equity shareholders in Visnews.

Reuters has paid the B.C.N.Z. just over $2.6 million in cash for all but one of its Visnews shares. The Australian Broadcasting Corporation, and the Canadian Broadcasting Corporation, will also sell most of their Visnews holdings to Reuters. The changes are aimed at clearing the way for Reuters and the 8.8. C. to inject funds to expand Visnews, particularly in the expensive area of satellite television. In 1985 Reuters increased its shareholding in Visnews, and since then much-needed capital

which the public broadcasting corporations could not provide, had been poured into the company.

However it had been decided the company could expand further by changing its structure, so that the minority public broadcasting organisations involved would not be called on to fund the expansion. While Visnews had successfully expanded into satellite television over the last few years, substantial sums of money were still required. Reuters had injected more than $5.2M into Visnews since increasing its stake two years ago.

“While that has been successful, the situation frankly has been that each of the public broadcasting corporations have been under some pressure to fund their own capital expenditure, for their own domestic capital expan-

sion,” said Mr Rennie. At the same time they wanted to ensure the editorial independence of, Visnews, overseen by a, board of trustees, maintained the quality of the news services provided.

Now the commercial side of Visnews would be funded mainly by Reuters, with help from the 8.8. C., but New Zealand and the other original shareholders would maintain places on the board of trustees.

Along with the A.B.C. and C.8.C., the B.C.N.Z. has a 21-year contract to exchange news with Visnews. Mr Rennie said that once Visnews had been TVNZ’s main supplier of overseas television news pictures. However, with the development of satellite links three or four years ago TVNZ had increased its use of other sources.