FREEHILLS and Baker & McKenzie were among the principal legal advisers to the Seven Network and private equity firm Kohlberg Kravis Roberts (KKR) in their joint venture deal to run half of Channel Seven’s media business.
To be known as Seven Media Group, it will include Seven’s television, magazine and online businesses.
The move follows a similar joint venture between rival Publishing and Broadcasting Limited and international private equity investor CVC in October.
KKR has committed to invest $735 million for a 50 per cent stake in Seven Media Group, which Seven Network says will pursue media acquisitions in Australia and New Zealand.
Seven will receive approximately $3.2 billion in cash, as well as the 50 per cent stake in Seven Media Group.
Like CVC investment in PBL Media, KKR’s will be in the form of convertible notes which can’t be converted until after the cross and foreign media ownership amendments to the Broadcasting Services Act 1992 commence.
Also similar to PBL Media, Seven Network will retain management control of Seven Media Group, including proprietor Kerry Stokes as chair of the new entity. Seven Network CEO, Broadcast Television, David Leckie will be CEO of Seven Media, and Seven CFO Peter Lewis, will be CFO of Seven Media.
Lead partner on the deal, Fiona Gardiner-Hill, said one of the challenges was the need to finish the work for the Seven Network in a “very short time frame”.
“What we were able to do was provide a team who had experience and expertise across all of the areas,” she said. This included M&A, private equity and regulatory and public company issues, like application of listing rules and disclosure rules.
As well as Gardiner-Hill, Freehills’ team included partner Damien Hazzard and senior associate Elizabeth Henderson. Banking and finance partner Patrick St John also assisted with financing arrangements.
International firms Baker & McKenzie and Simpson Thacher & Barlett LLP acted for KKR.