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Fairfax and NZME appeal rejected merger

NZN 25/05/2017 Paul McBeth

NZME and Fairfax New Zealand have hired the Queen's Counsel whose Court of Appeal arguments helped secure the Commerce Commission's authorisation of competition-killing merger in the wool-scouring sector, which the commission then used to justify rejecting the media merger.

The media companies have hired David Goddard to appeal the commission's rejection of their planned merger, hoping his pedigree in the Cavalier wool-scouring authorisation will win the backing of the courts.

The media companies will file papers in the High Court on Friday claiming the regulator was wrong in fact and in law in rejecting their planned merger earlier this month.

The fusion would have combined NZME's flagship New Zealand Herald newspaper and nzherald.co.nz website, a portfolio of radio stations, including Newstalk ZB, and the GrabOne deals site with Fairfax's suite of titles including the Dominion Post, Sunday Star-Times, The Press, the stuff.co.nz website and magazines.

They argued the likes of Google and Facebook was hoovering up all the advertising revenue and they need to combine to survive.

The commission accepted the merger could extend the lifespan of some newspapers and save costs in the short term, but it believed the benefits did not outweigh the negative impact.

Mr Goddard has joined Russel McVeagh in representing the media companies in their application, having successfully seen off opposition to the Commerce Commission's authorisation to create a national wool scouring monopoly. The media groups cited the long-running case extensively in their application to the regulator, which also drew on the ruling in its decision to reject the merger.

The firms are also appealing on the grounds that the decision was procedurally unfair by granting anonymity to many submissions opposing the application.

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