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Seven West Media makes bid for Prime

·1-min read

Seven West Media is proposing to buy regional TV broadcaster Prime in a deal worth $131.9 million.

The two companies have reached conditional agreement for a combined network which would reach 90 per cent of Australians.

Seven boss James Warburton said advertisers would gain easy access to capital city and regional viewers via a single platform.

The Prime board has urged shareholders to vote for the proposal at an extraordinary general meeting next month.

The board said the offer would give investors a certain outcome amid a challenging and uncertain future for regional television.

The regional broadcaster's audience and ad sales have been falling, mostly affected by the popularity of internet streaming services.

Prime has screened Seven programs in the ACT, Victoria, the Gold Coast, parts of NSW and all of Western Australia for many years.

A Seven takeover would ensure regional news services continue.

Prime investors who own 43.5 per cent of stock have already indicated they will vote for the proposal.

The Australian Competition and Consumer Commission must also approve the takeover. The competition watchdog has previously been concerned about the concentration of Australia's media outlets.

Seven West's bid represents a 57 per cent premium on the closing price of Prime shares on October 29 - 23 cents per share.

Prime said should investors vote for the proposal, they could expect a distribution of 36 cents per share. This would include a 10 cent capital return and 26 cent fully franked dividend.

Shares in Seven West on the ASX were up about 17 per cent to 53 cents at 1513 AEDT.

Shares in Prime were up almost 70 per cent to 39 cents.

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