Southern Cross Media announces strategic sale

Southern Cross Media Group (ASX:SXL) has announced the sale of its television licenses in Queensland, southern New South Wales, and Victoria to Network 10. This transaction is part of a strategic review of SCA's non-core regional television assets. The deal is set to finalize by February 2025, subject to customary conditions.

Outlook and strategic direction

Southern Cross Media Group's decision to sell its regional television licenses marks a shift towards focusing on core operations. The sale, expected to bring in $15 million to $20 million, will help reduce net debt. SCA plans to maintain its advertising sales services in these regions and potentially benefit from a 'digital dividend' if Network 10 surrenders its spectrum. Continued negotiations for other asset sales are ongoing, aligning with the company's strategy of enhancing earnings sustainability and future growth prospects.

Executive insights on strategic sale

SCA will retain a share of the profit from these licenses for five years post-sale and expects the aggregate gross consideration to be between $15 million and $20 million. Additionally, SCA will keep its local salesforce in these markets and provide advertising sales services for Network 10.