Sunday axing all Nine’s doing

Channel Nine’s new owners, CVC Asia Pacific, had nothing to do with the axing of Sunday and Nightline, says PBL boss Ian Law (pictured, right).

“The reality is, this is not a CVC-driven outcome,” Mr Law told The Australian. “This is simply normal decision-making between myself, David Gyngell and the executive team at Nine, on what we believe is prudent in the current uncertain economic environment.”

Law was responding to speculation that an array of closures of key programs and magazines at PBL Media have been prompted by the crippling debt facing the group, with rumours of big repayments to come.

Mr Law said he had “no comment” when questioned on whether CVC faced imminent debt repayments on its investment. PBL Media contains Nine, ACP, and 50 per cent stakes in Ninemsn and Carsales.com.au.

Media analyst Fraser McLeish of ABN AMRO caused an uproar last month after his report, published in The Australian, valued PBL Media at “zero, due to weak operating metrics, high debt and minimal visibility”. This suggested much of PBL Media’s $2 billion equity value in the original deal had evaporated.

Under Adrian McKenzie (pictured, left), CVC started buying PBL Media from the Packer family in October 2006, financed by extensive borrowing. The vehicle now holds about $4.2 billion in debt. (While CVC now has majority-ownership of PBL Media, the Packer family continues to hold 25 per cent of the group).

“Nine is performing well in terms of consistent delivery of 25-54 demographics – which is the key audience for advertising share – but it is always a matter of judgment, striking the balance between chasing revenue and controlling costs,” he said.

However, he has praised Mr Gyngell’s stewardship at Nine: “The evidence is under David Gyngell’s leadership, the viewing audience has grown and costs have been controlled.”

Source: The Australian