Southern Cross Broadcasting is in talks with various players about possible mergers or takeovers, but nothing has passed more than an exploratory stage.

Southern Cross made an announcement to the market, along with Austereo, after the Stock Exchange compelled media companies to declare their hand in possible mergers and acquisition talks that may have begun in the wake of the new media rules passing through parliament this week.

Southern Cross has an open share register, so anyone can buy into it if they do not breach present and/or future media laws.

While Southern Cross has made no comment on whether it is a buyer or seller, there is much speculation who the company may be talking to.

One natural partner for Southern Cross to do some deals with could be DMG, which owns 5AA Adelaide, the only city where Southern Cross does not own a talk station, because up until now it has owned the tv station so not been able to own a radio company in the same market. Now that James Packer has already done his deal and put NINE out of the play, Channel TEN could also a possible link for Southern Cross, because of the close programming connections between the two tv networks in regional Australia. Southern Cross also has experience in regional radio stations, so may be interested in deals with Macquarie Regional RadioWorks. Many other players could be interested in working more closely with the diversified media company, which is already an example of the benefits of owning assets in more than one broadcast medium.

Meanwhile, Prime TV, which owns regional tv stations and recently acquired a small number of regional radio stations in Queensland, did not trade on Thursday. Prime denied it was in a trading halt and said it had nothing to do with any takeover or merger talks. And overnight News Corp has bought a small strategic stake in Fairfax so it can be across any moves that may take place around the newspaper company.

Over the past ten years, Southern Cross Broadcasting has
evolved into one of Australia’s leading media organisations, with a diverse network of television and radio operations,
which have the potential to reach 94% of Australia’s
population, together with an integrated television production
and distribution group.

Southern Cross Broadcasting made $544 million in sales revenue last financial year and Managing Director Tony Bell took home a salary of over $1 million. The company has tightened expenditure, although its $57 million profit in 2006 was down on the previous year.

The company paid final dividends this week and has been strengthening its share price on media merger speculation in recent weeks. Its annual general meeting is scheduled for mid November.

Speaking to radioinfo in July Tony Bell said: “There are limited synergies between [owning radio and tv in the one market]. News is presented in a very different format. Radio presents news in four minutes compared with television’s twenty minutes. There are no programming synergies and few sales synergies, even though this would be contrary to popular belief. The two mediums are far too separated in advertising rates, broadcast material and meeting the objectives of the advertisers. There are, of course, promotional synergies.

“I think [our] share price fairly reflects the value of the business, no more, no less. There is no premium on the share price.”

Click below to view the earlier interview in full.

Refering to moves by Packer’s PBL and Stokes’ Seven Network, Communications Minister Helen Coonan attempted to hose down too much enthusiam for any merger frenzy, saying:

“I think it’s important that any movement has in mind the current requirements as well as the regulatory regime when the new laws come into effect on a date yet to be decided… I’ve asked ACMA to have a look at [PBL and Seven].”

Coonan did not say exactly when the new laws would be proclaimed because of “market sensitivity,” but did expect it to happen next year.