ARN owner HT&E settles dispute with tax office for $71 million
The long-running dispute between ARN’s parent company Here, There & Everywhere (HT&E) and the Australian Taxation Office (ATO) has finally been settled.
HT&E will pay $71 million to resolve the matter.
HT&E had already paid a deposit of $50.7 million and the remaining $20.3 million will be funded from its existing cash reserves.
The protracted dispute related to the 2009 and 2016 calendar years. It involved $102.5 million of tax adjustments, $49 million of penalties and $43 million of interest – totalling $195 million.
The HT&E board maintains that it is satisfied with its actions in the matter, claiming they were consistent with the relevant taxation legislation. It noted, however, that the settlement arrangement is in the best interest of shareholders, and is considered a fair and reasonable outcome for the company.
The length of an ongoing dispute, potentially costly litigation and the impact of ongoing uncertainty were also taken into account.
HT&E said its balance sheet remains strong despite the payout, and the resolution means it no longer has the potential liability for substantial tax, interest and penalties looming large.
The company can now look forward with certainty, it said.
Under CEO Ciaran Davis, HT&E has in recent years flirted with the idea of further acquisitions. The potential to execute these, however, has been somewhat curtailed by the looming payout to the tax office and any impact this may have on HT&E’s balance sheet.
In May, he said the company was “open to anything” when it came to acquiring assets or striking media partnerships deals.
“We’ve got a board and management team and a very clear vision for how this market is going to move in the next three to five years. Consolidation is absolutely going to happen, because advertisers, CMOs, brands are looking for a partner who can offer scale, reach, multi-platform content delivery and increasingly offer addressable IDs so they can engage on a much more one-to-one spectrum,” he said, citing Nine and its integrated offering of TV, broadcast video on demand, subscription video service Stan, newspapers and radio as a successful example of this consolidation.
He will look at any opportunity which will help the company grow its balance sheet and business, he said.
In August, Davis told Radio Today that consolidated media companies of the future will need four things: scale, multi-platform content delivery, ease of trading, and an increasing bank of addressable IDs.
“And all media companies are trying to do that at the moment, but I think successful ones and the ones that can start capturing revenue from the likes of Google and YouTube and Facebook and Instagram and Snapchat will need to offer that at an accelerated pace,” he told Radio Today.
At the time, he said the next 12 months will see companies attempting to get back into pre-COVID shape, which will involve some coming together in a bid to get a bigger share of the available revenue.