Fairfax Media has revealed on the evening of May 17 it received an indicative, preliminary and non-binding proposal on behalf of funds affiliated with Hellman & Friedman LLC (together with affiliates, Hellman & Friedman) to acquire 100% of the shares in Fairfax (on a fully diluted basis) at a price between $1.225 to $1.250 per share, with all consideration being in cash. The proposal assumes no dividends are paid by Fairfax from the date of the proposal to completion (H&F Indicative Proposal).
The second proposal follows the revised, indicative, preliminary and non-binding proposal from the TPG Consortium to acquire 100% of the shares in Fairfax (on a fully diluted basis) at a price of $1.20 per share.
The Fairfax Board has considered both proposals and determined they will invite both Hellman & Friedman and the TPG Consortium to conduct due diligence in order to establish whether an acceptable binding transaction can be agreed.
Commenting on the proposals, Fairfax’s chairman Nick Falloon said: “The Fairfax Board appreciates the support shareholders have demonstrated for Fairfax’s current strategy and the potential separation of the Domain Group. We have carefully considered the indicative proposals and believe it is in the best interests of shareholders to grant both parties due diligence to explore whether a potential whole of company proposal is available.”
The proposals are subject to various conditions, including due diligence, Fairfax shareholder approval, and obtaining requisite regulatory approvals, including Australian Foreign Investment Review Board (FIRB) and New Zealand Overseas Investment Office (OIO) approval.
US equity firm Hellman & Friedman is chaired by former Fairfax Media chairman Brian Powers. He is also a former chairman and MD of Consolidated Press in Australia.