Faifax Media and Rural Press

Wednesday, December 6, 2006

Faifax Media and Rural Press announce proposal to merge and create Australais's largest integrated metropolitan, regional and rural print and digital media.

BUSINESS Fairfax Media and Rural Press Limited today announced a proposal to merge and create Australasia’s largest integrated metropolitan, regional and rural print and digital media business.

MERGER HIGHLIGHTS
• A cash and scrip merger proposal for the entire issued capital of Rural Press

• Creates Australasia’s largest integrated metropolitan, regional and rural print and digital media business with an enterprise value of over $9 billion

• Positions the combined business to take advantage of rapid growth in online media through enhanced financial and operational scale and high quality, localised content offering

• Unanimously recommended by the Rural Press Board in the absence of a superior proposal for all the Rural Press Ordinary and Preferred shares

• Under the merger proposal, each Rural Press Ordinary and Preferred shareholder will be entitled to receive for each share held:
- 2 Fairfax Media shares and $3.30 in cash; or
- 2.3 Fairfax Media shares and $1.80 in cash

• In addition, the Rural Press Board intends to declare a fully franked special dividend in respect of each Rural Press Ordinary share and Preferred share of 57.143 cents and 62.858 cents respectively

• The merger proposal represents a significant premium to recent Rural Press share prices

• EPS enhancing from FY08 (excluding one-off integration costs)

• Estimated synergies of at least $35 million per annum expected to be realised in 12 to 18 months

• Two Rural Press non-executive Directors will be invited to take up seats on the Fairfax Media Board of Directors, which will be expanded to nine. Mr Ronald Walker will continue as Chairman.

Please click here to download further information.

Source: John Fairfax Holdings Limited
Release Date: 6 Dec 2006 00:00