The takeover can now go ahead and will be completed on 31 December. However, the news didn’t elicit a positive response from the market.
As of today’s close, the Seven West share price is 61 cents, 0.81% lower than its previous close.
Meanwhile, the Prime Media share price surged 2.27% higher to trade at 45 cents.
For context, the S&P/ASX 200 Index (ASX: XJO) finished the day 0.31% higher.
Let’s take a closer look at the latest update on Seven West’s proposed takeover.
Seven West share price flops despite takeover news
The market bid the Seven West share price lower today despite its latest takeover surpassing the progress of its previous attempt to buy Prime Media.
Back in 2019, Seven West’s merger proposal was blocked by 53.5% of Prime Media’s shareholders. Today, more than 99% of Prime Media shareholders approved of the transaction.
Seven West is now set to take over its media peer for $131.88 million. That will see Prime Media shareholders receiving 36 cents per security they hold.
While that’s currently 20% less than the Prime Media share price, at the time Seven West posed its offer it represented a 56% premium on Prime Media’s previous close.
Prime Media operates the Prime7 television network in Eastern Australia and its sister network GWN7 in parts of Western Australia.
The transaction will be conducted through the acquisition of Prime Television, Seven Affiliate Sales, and all their subsidiaries, by Seven West.
The company believes the takeover will “create the leading wholly-owned commercial premium broadcast, video, and news network”.
Despite today’s dip, the Seven West share price is 32% higher than it was prior to announcing the acquisition. It has also gained 69% year to date.