While John Fairfax
Holdings was busy adding to its New Zealand publishing stable yesterday
with a $10 million acquisition of the Rodney Times newspaper group’s
three mastheads, speculation was mounting over whether the struggling publisher of The Age, SMH and Financial Review might be the target of a bid from the John B Fairfax-controlled Rural Press.

According
to Goldman Sachs JBWere, Rural Press’s outerperforming share price
raises the prospect it could acquire Fairfax by using its highly rated
scrip as currency, despite the target being essentially double its
size. Rural Press is one of the few media companies that could make
such a move even before media rules change, says Credit Suisse First
Boston. A full scrip bid would leave John B Fairfax’s Marinya Media
with 15.2% of the combined group, versus his 46% holding in Rural
Press.

So where does the rumour come from? Well, not Rural
Press, that’s for sure. Crikey understands the speculation simply comes
from clever analysts putting two and two together: Rural Press is
renowned for its first class management outfit – which is why it’s the
most expensive media stock on the market – while Fairfax is in dire
need of help on the management level. A potentially perfect match.