NZME, Stuff merger appeal begins

Tuesday, 5 June 2018

NZME says the terms of its proposed merger with Stuff Ltd would be renegotiated if their appeal against a Commerce Commission ruling is successful

NZME and Stuff Limited have begun their latest appeal over the refusal of the Commerce Commission to authorise their proposed merger.

The companies have taken their case to the Court of Appeal in Wellington after last year failing to persuade the High Court to overturn the block on their merger.

The appeal is expected to take four days though it could be months before a decision is released.

NZME and Stuff Ltd had originally proposed in 2016 that Stuff Ltd would be folded into NZX-listed NZME, with Stuff's Australian owner Fairfax Media in return receiving a 41 per cent stake in the combined business plus $55 million cash.

However, NZME said in March that the terms of merger would be renegotiated if the appeal was successful, given the time that had passed since the original agreement.

The appeal is expected to hinge on whether the Commerce Commission was entitled and correct to reject the merger because of concerns it had about media 'plurality' or diversity despite finding a strong economic case to allow the businesses to combine.