The Prime Media Group Limited (ASX: PRT) share price was not trading today despite news that the Australian media regulator has approved Australian Community Media (ACM) obtaining a 20% stake in the company.
At yesterday's market close, shares in the rural and regional broadcaster were trading at 21 cents each.
Let's take a closer look at today's news and what it might mean for the Prime Media share price.
ACM buys Prime assets
The Australian Communications and Media Authority (ACMA), approved ACMs purchase from Bruce Gordon, owner of WIN Network and third-largest owner of Nine Entertainment Co Holdings Ltd (ASX: NEC).
The purchase increased ACM's stake in the company to 19.99% from its previous 14.67%. Under the Broadcasting Services Act (1992) any party which seeks to control 15% or more of a media company must first obtain the approval of ACMA.
ACM made the purchase one month previously.
The purchase has made ACM the largest shareholder in Prime Media, overtaking Seven West Media Ltd (ASX: SWM) major owner Kerry Stokes.
In a note to ACM staff, as reported by The Australian, part-owner Antony Catalano said:
The Prime Media Group is in a strong financial position, it is well-managed, and we believe it has an important role to play in the evolving regional media landscape.
ACM and Prime audiences have similar interests, aspirations and goals. We hope to explore ways in which we can work more closely to ensure we continue to deliver the highest-quality journalism for regional Australians.
As part of the deal, ACM will need to sell its regional newspapers in Bendigo and Wagga Wagga. This is to comply with Australian legislation.
Prime Media share price snapshot
Despite today's dearth of price movement, the Prime Media share price has been very successful over the past 12 months. In the past year, Prime Media's value has increased by 112.12%. Media companies suffered heavily from the COVID-induced market crash of last year.
Prime Media has a market capitalisation of $75.2 million.
