ARN Media Limited [ASX: A1N] has announced that it had acquired a 14.8% interest in Southern Cross Media Group Limited [ASX: SXL].
ARN Media says it acquired the stake as a strategic equity investment in a sector that it knows well and sees the equity position in Southern Cross Media as representing attractive value for ARN Media’s shareholders.
The company spent AUD$38.3 million in acquiring the equity interest in Southern Cross Media. ARN Media says it will separately release in due course the ASIC Form 603 “Notice of initial substantial holder”.
Southern Cross Media Group Limited noted the announcement and that ARN Media sees this equity position as representing attractive value for ARN Media’s shareholders.
For the purposes of rule 3.19.1 of the ASX Listing Rules, SCA also noted that, under the Broadcasting Services Act 1992 (Cth) (BSA), ARN Media would be deemed to control SCA’s commercial radio and television broadcasting licences were ARN Media to hold an interest of 15% in SCA. Because SCA and ARN Media control the maximum permitted two commercial radio broadcasting licences in all metropolitan markets and several regional markets, the BSA prohibits ARN Media holding an interest of 15% or more in SCA.
Following the announcement, ARN shares dipped slightly by AUD$0.02 to $1.03 while SCA shares jumped from a June 19 close of $0.76 on June 19 to $0.92 on June 20, the day of the announcement.