NZME. would pay $55million in cash and issue shares giving Australia's Fairfax Media 41% if a planned merger of New Zealand's dominant publishers was given the go ahead by the Commerce Commission in March next year.
The two media companies signed a merger implementation agreement, subject to various approvals, that would mean NZME. adding another $90million to its banking facility so it could buy all the shares in Fairfax New Zealand in a cash and scrip deal.
The companies identified areas where a merged entity could avoid double-ups, which NZME. said would lead to one-off costs being incurred.
Mr McIntyre said the announcement yesterday should be seen as a market update. If the companies had been working on the deal, they were obliged to inform the market under disclosure rules.
''I cannot see the Commerce Commission giving it the rubber stamp of approval without some assets having to be sold or compromises made around geographic regions to protect competition and fairness to advertisers.''
The announcement was how the two companies regarded the highlights for them, he said.
An important part was NZME. acknowledging it expected to increase its bank facilities to $250million through a syndicated bank facility.
''You can't roll up to the bank on the day the merger is announced. All of these steps need to be put in place.''
While the merger implementation agreement was conditional upon finance, NZME. had committed term sheets from its banking syndicate for the full $250million.
In the year to June, Fairfax reported revenue of $350.3million and operating earnings of $60.2million. In the same period, NZME. generated revenue of $415.9million and operating earnings of $75million.
NZME. chief executive Michael Boggs said in a statement to the NZX Fairfax NZ's New Zealand audience reach was complementary to that of NZME. and 72% of the country engaged with its content each day across mobile and online platforms, newspapers and magazines.
The combined business would have an audience reach of about 3.7million New Zealanders, offering greater depth of news, sport and entertainment.
The combined business was expected to create opportunities to increase value for NZME. shareholders, Mr Boggs said. There would be more brands, allowing the provision of news, sport and entertainment with greater national reach.
Improved diversity of content, including more local content, would attract audiences.
The merger would provide a ''more compelling proposition'' to advertisers as a result of the greater reach and improved content.
''We are delighted to have progressed merger negotiations to this state and be in a position to shortly put this proposition to NZME. shareholders,'' he said.
Mr McIntyre repeated comments from earlier when he said it was a time of uncertainty for both shareholders and others involved in the merger, including staff.
''There will be a huge amount of change between now and when the Commerce Commission releases its decision. This is a fast-moving sector.''
The commission previously said it intended releasing a draft determination by early November.
The determination would set out the commission's preliminary view on whether the proposed merger would be likely to result in a substantial lessening of competition, as well as balancing the public benefits and detriments it might bring about.
Following the release of the draft determination, the commission would seek further submissions from interested parties.
The decision-making timeframe allowed for a public conference to be held in December, should it be needed. A final decision would be released on or before March 15 next year.
