Kerry Stokes' Seven West Media is planning to merge with Southern Cross Media, Australia’s largest radio company, to create a $415 million media group that spans television, radio, and publishing.

The merger will result in Seven shareholders receiving 0.1552 Southern Cross shares per Seven West Media share, with ownership split nearly evenly—49.9% for Seven and 50.1% for Southern Cross—pending regulatory approval.

This combined entity aims to strengthen operations across metropolitan and regional Australia, covering television, radio, digital, and publishing sectors.

Some investors, like Sandon Capital, have expressed skepticism, criticizing the deal as 'diworsification' due to exposure to challenged free-to-air TV markets amid declining revenues for both companies.

The deal values Seven at approximately $215 million and Southern Cross at around $201 million, with shareholders accepting a slight discount based on recent share prices.

The merger is expected to generate annual cost savings of $25 million to $30 million through consolidations, office closures, and elimination of duplicated functions.

Following the announcement, investor confidence increased, with share prices rising—Seven West shares up by 7.1% and Southern Cross by 4.2%.

Both companies' CEOs, Jeff Howard and John Kelly, will continue in leadership roles, with Kelly taking on the role of group managing director for audio, to facilitate operational integration.

The combined company will be valued at $417 million, with an EBITDA of $230 million, inheriting Southern Cross’s $287 million net debt, and the merger is subject to shareholder and regulatory approval, with a vote expected in early 2026.

Approval from shareholders and regulators, including the Australian Communications and Media Authority, is required, and some asset divestments may be necessary to meet media ownership laws.

Kerry Stokes has expressed strong support for the merger, highlighting strategic and financial benefits that will enhance services across multiple media platforms.

Heith Mackay-Cruise will succeed Stokes as chairman, with Jeff Howard as CEO of the merged company and John Kelly continuing as managing director of audio.