Australia's Seven Network has announced it is to spend $33m (A$65m) to take a 50% interest in PMP Limited's many magazine businesses, which include the titles New Idea, TV Week, That's Life and Home Beautiful. The deal also includes the magazine distribution company Gordon and Gotch and an option for PMP to sell its interest in the joint venture to Seven for $38m (A$75m) within 12 months.
The broadcaster has also committed a further $10.3m (A$20.35m) for 37 million new shares in the parent company. It is expected that the acquisition of further shares on the open market will eventually lead to Seven having a 20% slice. Both deals are subject to due diligence.
Seven Network Ltd executive chair Kerry Stokes is painting the partnership as the next stage in Seven's development as an integrated media and communications company that already encompasses free-to-air subscription television and online activities. It will also provide significant cross-promotional opportunities.
Public company Publishing and Broadcasting Ltd (PBL), which owns Seven's principal competitor, ratings leader the Nine Network, owns Australia's biggest magazine group. PBL's main shareholder is Kerry Packer and his family.