No more money for 3MTR

Macquarie Radio Network has issued a default notice on its 3MTR joint venture partners Pacific Star. Pacific Star has in response requested a stock market trading halt until next Monday.  Macquarie has called in its debts and will not provide further funding to 3MTR unless a new budget, proposed earlier, is accepted. The matter is now back before the courts, with Pacific Star’s CEO Barrie Quick telling The Age, “I would say it does certainly place some doubt over the long-term future of MTR.”

 

MRN’s recent ASX results announcement reported a $1.7m loss, made up mainly of 3MTR losses.   Now Macquarie wants its money back.

 

Macquarie Radio Network has “declared the amount owing under the working capital loan agreement to be immediately due and payable by MTR to MRN. Consequently MRN will not provide MTR with any further funding under the working capital loan agreement,” said the company in a statement to the stock exchange.

 

You can recap the ongoing sage of 3MTR’s finances in our earlier stories.

 

3MTR dropped to a 1.4% share in last weeks ratings results and advertisers spent only $856,000 with MTR in the six months to the end of December.

 

Under the joint venture deal, Pacific Star is not liable for MTR’s losses and receives “cost recoveries and a guaranteed minimum profit share,” which is now at risk. The company says it is in ongoing discussions with MRN “relating to agreeing a sustainable business model for this station.”