A business model where property portal Domain is the prize and newspapers the problem is among the reasons two equity firms may have soured on a multi-billion dollar takeover of Fairfax Media, analysts say.
Rival bidders TPG and Hellman & Friedman both ended their interest in bidding for Fairfax at the weekend, with no reason given.
While Fairfax attributed the snub to its complicated portfolio, Citi analyst David Kaynes said costs in the metropolitan media division, which includes The Sydney Morning Herald, The Age and The Australian Financial Review, remains Fairfax’s key trouble.
“Metro media, in particular with its single digit margin and double digit revenue declines, will require ongoing cost cutting and restructuring c…
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