Singleton moves on Fairfax

Further to our article about John Singleton buying into Fairfax Media here, it has been revealed that Mark Carnegie and Singleton were hoping to buy up to 4.9% before announcing their plans.

But as Singleton owns 71% of the Macquarie Radio Network, which has a broadcast licence, he is subject to tougher disclosure requirements.

The Singleton/Carnegie vehicle (Gutenberg investments) was required to reveal their purchase of Fairfax shares early, given that they have entered an arrangement to act in consultation with Gina Rinehart and her shareholding, acting essentially as one entity. This takes the combined shareholding of Rinehart's investments and Gutenberg to 15.14%.

You can see the contract between Rinehart and Singleton/Carnegie outlining their agreement here.

Gutenberg formally announced this morning that they have purchased 0.15% of Fairfax, which has created a 15.14% combined share. Whilst this has meant Singleton has had to declare the interest, it does not take him into technical breach under the ACMA ownership regulations allowing 'two to a market'.

Media analyst Peter Cox has told the ABC:

''Singleton was very upset when Fairfax would not sell the radio stations to him, which he offered $200 million for, which is probably a lot more than what they would get for the radio stations today, so Singleton is now moving in concert, if you like, with Gina Rinehart to have more effect at Fairfax."

John Singleton has been blunt about the reasons for his move on Fairfax shares.

He claims to have offered an attractive price for the radio assets earlier this year, believed to be between $200m and $250m, this was declined by Fairfax as too low. Fairfax put the group of radio assets together for around $320m.

Now, Singleton has obtained a strategic stake in the company, which based on the current share price, was achieved for a multiple of 2-3x earnings.

It seems unlikely that he has any real interest in Fairfax more broadly, rather that he may be hoping his presence, combined with that of his close friend Gina Rinehart, will reignite a sale of the Fairfax radio assets.

Either way, the Fairfax roller coaster looks set to continue.