Southern Cross Media Group (SCA) has turned down a revised acquisition deal from ARN Media (ARN) that would have seen the network acquire certain SCA radio assets, and become the sole owner of the joint digital audio assets of ARN and SCA.

SCA Chair, Heith Mackay-Cruise, said the proposed deal provided "downside" for SCA shareholders, noting that ARN's Consortium with Anchorage Capital Partners (ACP) had failed to "deliver its original proposal in an executable form" after more than seven months of back and forth.

"SCA is Australia's largest commercial radio and fastest growing digital audio business. Under the alternative proposal, SCA shareholders would be left with a minority interest in an expanded ARN business and full ownership of sub-scale commercial radio assets and declining regional television assets, with limited exposure to the fastest growing media sector of digital audio, and with no cash in return," said Mackay-Cruise. "The SCA Board does not believe transferring that complexity, value and execution risk to SCA shareholders is in their best interests."

Under the proposed deal, 'New ARN' would have comprised a metro radio network of 10 stations under the KIIS and Triple M brands, and 100% of ARN's and SCA's existing digital audio assets. 'New SCA', on the other hand, would have consisted of the radio and TV assets that would have been acquired by ACP under the previous Consortium proposal.

SCA has not received any formal proposal from ARN following ARN's announcement that the Consortium's proposal was withdrawn.

In a trading update for the four months ended 30 April 2024, SCA reported a 2% increase in SCA Audio revenues compared to the corresponding period. Its regional television business continued to decline at a rate consistent with the first half of FY24, with YTD revenues down 10%. Transaction costs associated with the Consortium's proposal are expected to be between $4m and $5m and will be recognised as a non-recurring item in SCA's FY24 results.