Australia, insurance, car, home, live, holidays

Major Macquarie Media shareholder John Singleton.Credit:Kate Geraghty

The deal would likely require the support of both advertising mogul Mr Singleton,who owns 32.4 per cent of the business,and Mr Carnegie who has a 3.6 per cent stake.

Sources close to the major shareholders have now confirmed they are expecting to agree with the offer,which has been described by some investors as"disappointing",should an independent report from PwC recommend it be accepted.

The PwC report is due in early-September and is an independent analysis that is a standard part of the process of taking an offer to shareholders. The Macquarie board's independent committee recommended the offer earlier in August,despite the share price trading at around $1.71 ahead of the announcement.

While Macquarie's high-rating 2GB presenter Alan Jones,who owns 1.3 per cent of the business,previously said he washe was inclined to support the deal other small shareholders have been scathing.

If Nine are able to get it at this price,it is a steal.
Geoff Wilson,Wilson Asset Management

Wilson Asset Management founder Geoff Wilson and former colleague Centennial Asset Management's Mathew Kidman have bothpublicly criticised the price as too low.

Mr Wilson has beenincreasing his 4 per cent stake in Macquarie for clients as part of a campaign against the offer which has included convincing other shareholders to fight against the bid.

Mr Wilson said he was"perplexed"about the likely support for the bid,adding he considered the offer to be opportunistic after a difficult advertising marketaffected the network's 2019 financial year results in early-August.

"I think the synergies are significantly underestimated and the Macquarie shareholders are entitled to another 17.5c fully franked dividend,which under the current structure of the bid they'll miss out on,"he said.

"When[Fairfax Media] bought the radio assets in 2014 they talked about $10 million to $15 million of benefits in synergies. They achieved $22 million in synergies on our numbers."

On his own calculations and when using the valuation methodology used by Grant Samuel - the firm that did the independent report for the Nine-Fairfax merger in 2018 – he said a mid-price valuation for the shares was $1.76.

"We believe that the talk of the $10 million in synergies undervalues the benefits,they'll achieve more benefits than that. You could easily see …[the business being worth] a price above $2,"Mr Wilson said."If Nine are able to get it at this price,it is a steal."

Macquarie Media chief executive Adam Lang declined to comment on what the major shareholders would do,but confirmed the PwC report was due within two weeks. Nine declined to comment.

License this article