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THE embattled Fairfax Media (ASX: FXJ) has announced the completion of discussions with Hellman & Friedman LLC and TPG Group regarding the possible sale of the media group.
Following Fairfax's assessment of the two unsolicited, preliminary, non-binding indications of interest from Hellman & Friedman and TPG the media group has decided to cease discussions with both parties.
Hellman & Friedman, a private equity firm made headlines after bidding $3 billion for the Australian media group, slightly higher than TPG's $2.7 billion bid.
"Following the conclusion of this process Fairfax did not receive a binding offer from either the TPG Consortium or Hellman & Friedman. Accordingly, the Fairfax Board has ceased discussions with both parties," says Fairfax in a statement issued today.
Fairfax Chairman, Nick Falloon, says the company has an attractive future for shareholders and will continue to separate standalone business Domain.
"The Board appreciates the support that shareholders have demonstrated for Fairfax's current strategy," says Falloon.
"That support has been communicated during this process with a strong desire for Fairfax to progress the Domain separation and to continue to execute on its plans."
Falloon has encouraged shareholders to hold tight, saying the company will deliver returns in the medium to long-term future.
Additionally, Falloon believes proposed reforms to media regulations expected later this year will provide a much-needed boost to the group.
Fairfax Chief Executive Officer, Greg Hywood, says the separation of Domain will conclude by the end of 2017.
"We are making excellent progress with preparations and have progressed all of the necessary regulatory approvals to meet our timetable for completion by the end of 2017," says Hywood.
In today's release, Hywood detailed a six-point strategy to drive more value from each of Fairfax's core businesses.
Hywood says the group is committed to further strengthening the Domain Group as its first priority.
Fairfax owned video-on-demand service, Stan, is expected to achieve cash flow breakeven in 2018, and Falloon says driving growth in the service is important.
"We believe that our shareholders should be the beneficiaries of the value to be unlocked from our unique combination of assets and the strategic plans in place for each of our businesses," says Falloon.
Ahead of the group's full year results, to be released 16 August 2017, Fairfax revenues are down six per cent compared to the same time last year.
Domain is the sole faction of Fairfax Media to report overall revenue being up compared to the same time last year, with its total digital business up 22 per cent and accelerating.
The group expects EBITDA of between $262 million and $266 million for the year ending June 2017.
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