Southern Cross Media Group (SCA) will not go through with ARN Media and Anchorage Capital Partners consortia proposed acquisition, claiming the Indicative Proposal in its current state "undervalues" SCA.

"Our Board acknowledges the strategic merit underlying the Consortium’s proposal but considers that the current terms of the proposal undervalue SCA," said SCA Chair Rob Murray in an ASX filing this morning. "We are open to considering proposals from the Consortium or other parties that would deliver fair value and be in the best interests of all our shareholders. In the meantime, we remain focused on continuing to optimise the audio ecosystem we have created across broadcast radio and digital audio. This is central to our strategy and our value proposition, and we are committed to converting our audience leading positions into sustainable growth and returns to our shareholders."

ARN and Anchorage Capital Partners had made an "unsolicited" offer to acquire 100% of the fully diluted share capital in SCA. The offer proposed a re-allocation of SCA and ARN assets into a reconstituted company (ARN Newco) and 29.6 cents cash per share by way of a recommended scheme of arrangement.

SCA evaluated additional materials regarding the expected earnings profile of the ARN Newco shares to be offered to SCA shareholders. The company said there had been fundamental changes to the economics of the Indicative Proposal, including an increase in the leverage and reduction in the earnings base of ARN Newco, from that indicated by the Consortium in its original proposal, which significantly reduced the value of the Indicative Proposal to SCA shareholders.

SCA is the parent company of LiSTNR, the Hit and Triple M networks and regional television stations. SCA owns 99 radio stations across FM, AM, and DAB+ under the Triple M and Hit network brands and provides national sales representation for 56 regional radio stations.

SCA rejected an offer to merge with Australian Community Media back in November.