Via The Australian:
The auction for Fairfax Media has ended without an actionable bid after private equity firm TPG withdrew from the process over the weekend and Hellman & Friedman failed to lodge a bid.
TPG sent a letter to Fairfax chair Nick Falloon on Sunday notifying him of its decision and is now expected to turn its attention to other assets.
The move was based on concerns about the future valuations of the Domain real estate division, regarded as the prize asset within the Fairfax portfolio and accounting for more than one-third of Fairfax’s earnings.
Rival bidder Hellman & Friedman has not withdrawn from the process.
It sent a letter to the board of Fairfax on Friday after four weeks of due diligence that did not comply with the suitor’s conditions for an offer.
Fairfax is now expected to push ahead with its original plans to demerge the Domain business and list it separately on the stockmarket by the end of the year.
So, now we know that if you look under the bonnet you find something even less attractive than the surface. I wonder what put them off? The fatal attachment of loss leading journalism being destroyed by real estate spruiking setting up the shadow of a doom loop? The very obvious and enormous bubble underpinning the entire dubious enterprise? Smashed moral at a dying organisation? Is there something questionable in the way Domain and Fairfax allocate costs?
Clearly, whatever the cluster of variables, it is worth even less than it appears.
