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Home / Business / Media Insider

Media Insider: MediaWorks’ majority shareholder QMS acquires Oaktree Capital’s 45% stake – what it means for the radio and outdoor advertising media industry

Shayne Currie
By Shayne Currie
NZME Editor-at-Large·NZ Herald·
6 Apr, 2025 10:00 PM8 mins to read

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Simon Barnett and Lana Cochrane-Searle host MediaWorks' More FM breakfast show.

Simon Barnett and Lana Cochrane-Searle host MediaWorks' More FM breakfast show.

Radio and outdoor advertising company MediaWorks has been acquired by its majority shareholder, in a move that could lead to more major changes in New Zealand’s media landscape.

Australia-based outdoor advertising firm QMS, which has until today owned 54.41% of MediaWorks, will acquire US hedge fund Oaktree Capital Management’s 45.13% stake, leaving it with 99.54% of the company.

The new deal – promoted by MediaWorks as an “exciting” milestone to further enhance its radio and outdoor advertising combination – will reignite speculation about the future shape and direction of the company.

MediaWorks owns an outdoor advertising network and a suite of entertainment radio stations including The Breeze, More FM, The Edge, The Rock and The Sound.

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The only other shareholder is former MediaWorks chief executive Cam Wallace – now an executive at Qantas in Australia – who has a 0.46% stake.

MediaWorks last year posted a net after-tax loss of $107.1 million after an impairment of $86.5m – it insisted at the time that its “turnaround” was on track, despite a challenging economy and media market. It has been in constant communication with its lenders, notably Westpac, over its financial position.

In a statement today, QMS and MediaWorks said QMS’ acquisition of Oaktree’s stake was expected to close in the second quarter of the year (April-June), “subject to customary regulatory approvals”.

“As part of the transaction, fresh funding lines will be established for MediaWorks, providing increased flexibility for growth investment,” said the statement.

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The Herald understands new banking facilities have been established as part of the acquisition.

MediaWorks chairman Barclay Nettlefold and chief executive Wendy Palmer.
MediaWorks chairman Barclay Nettlefold and chief executive Wendy Palmer.

In announcing the acquisition today, QMS and MediaWorks have highlighted the advantages of leveraging QMS’ scale, for outdoor advertising on both sides of the Tasman, and radio in New Zealand.

In a statement, MediaWorks said the new deal would allow the company to better serve clients in New Zealand and Australia.

Despite QMS being a specialist outdoor advertising business, QMS and MediaWorks chair Barclay Nettlefold said there were no plans to sell the radio division.

“This transaction materially expands QMS’ scale and presence in the New Zealand market,” he said.

“We look forward to leveraging our capability as leaders in digital OOH [out of home advertising], particularly our expertise in delivering world-class street furniture networks such as the City of Sydney, to deliver excellent outcomes for both brands and outdoor asset owners in New Zealand.

“Combined with MediaWorks’ dominant position in radio and digital audio, the partnership creates a premier media platform for advertisers seeking to reach audiences across Australia and New Zealand”.

MediaWorks chief executive Wendy Palmer said: “I’m excited about this milestone in our company’s history.

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“Since 2019, MediaWorks has built a strong relationship with QMS, and this transaction marks the next chapter in our partnership. Together, we are bigger, stronger, and better positioned to deliver market-leading audiences to clients across the region.”

Future sale of QMS

Industry insiders have previously speculated that a QMS buyout of MediaWorks could pave the way for QMS’ owner, Australian private equity fund Quadrant, to potentially sell off the outdoor business to an international outdoor player, especially with a number of major outdoor advertising contracts under QMS’ belt.

Quadrant acquired 100% of QMS, then a public company, in 2019 for $A420 million.

QMS, through MediaWorks, was on the verge of securing the lion’s share of lucrative new Auckland Transport outdoor contracts before that tender process was abruptly stopped late last year.

That overseas sale scenario remains in play, particularly if QMS/MediaWorks still wins the majority of the new Auckland Transport outdoor contracts later this year – the tender has just reopened, with new deals set to be in place by October.

MediaWorks currently has the contract to run bus advertising for AT, and stands to gain a lot more if it can secure new contracts that are up for grabs.
MediaWorks currently has the contract to run bus advertising for AT, and stands to gain a lot more if it can secure new contracts that are up for grabs.

The four new contracts – for street furniture (such as bus shelters); transport hubs (such as stations); vehicular-based media (bus, trains and ferries; stations); and billboards – are estimated to be worth $350 million over the next 10 years.

It was announced in June 2020 that QMS had won the lucrative City of Sydney outdoor advertising contract – a 10-year deal, to kick in from 2021-22, valued at A$450m.

Oaktree’s exit

US hedge firm Oaktree Capital’s sale of its 45% stake marks the end of a 13-year association with MediaWorks.

Oaktree bought $125m of MediaWorks’ outstanding loans in 2012, at a reported discount of 50%. This was converted to equity in 2013 when the media company’s lenders seized control and pushed out former owner Ironbridge Capital.

MediaWorks, which had gone into receivership in June that year, came out of receivership six months later. Oaktree took 100% ownership of the business in 2015.

Today’s statement said that combined, “QMS and MediaWorks radio, OOH and digital assets represent one of the largest diversified media platforms in the region with more than 800 staff across 30 offices”.

It said that in New Zealand, MediaWorks engages with up to 3.5 million Kiwis across radio, digital and out of home (OOH) advertising. “QMS in Australia engages with over 20 million Australians across OOH, or 92% of Australians living in metro areas, each month.”

It was announced in June 2020 that QMS had won the lucrative 10-year outdoor advertising contract for the City of Sydney.
It was announced in June 2020 that QMS had won the lucrative 10-year outdoor advertising contract for the City of Sydney.

Big changes in the media landscape

Today’s announcement comes ahead of other major changes looming in the New Zealand media landscape.

NZME – the owner of most of the other major New Zealand radio brands as well as the NZ Herald and OneRoof – will on June 3 host its annual shareholders meeting and a vote to determine the future shape of its board. Auckland businessman Jim Grenon is leading a bid to remove most of the existing directors.

Meanwhile, rival publishing firm Stuff is expected to announce that Trade Me has acquired – either fully or partially – its digital arm, Stuff Digital, the company that holds the free Stuff website and the Neighbourly community website.

Other Stuff assets – including its newspapers and digital paywalled sites such as The Post and The Press – would remain under Stuff Masthead Publishing, in any such deal. NZME and Stuff had been in talks about NZME potentially acquiring those assets, although those have now stopped.

MediaWorks’ finances

MediaWorks announced its 2023 financial results - and the net after-tax loss of $107.1m – last May.

In those accounts, MediaWorks posted ebitda of $34.6m (up from $34.4m the previous year) and a net loss before tax of $14.2m million (compared with a $9.7m net loss before tax the previous year).

For the second consecutive year, auditors said “material uncertainties” existed which cast “significant doubt” on MediaWorks’ ability to operate as a going concern but the company said this was before refinancing was completed and it was confident it had the capital to deliver the company’s strategy.

The company said last May that “existing debt facilities were amended with the support of our shareholders and lenders shortly after the finalisation of our FY23 accounts”.

MediaWorks highlighted growth in outdoor direct revenue, up 13% on 2022, and digital revenue growth, up 20%.

In a note attached to the results – completed before refinancing was complete – the company said the group had net assets of $32.8m as at December 31, 2023, compared with net assets of $140.6m last year.

“The group is in the process of negotiating revised lending terms with its lenders. While negotiations are in progress, the lenders have indicated their continued support for the business including waiver of the financial covenants from September 30, 2023 up to the date a new agreement is signed, an extension of the maturity date of the facilities, revised financial covenants from March 31, 2024 onwards and deferral of debt amortisation payments until March 31, 2025.

“The lenders’ ongoing support is subject to completion of an equity injection from the shareholders and the group continuing to make interest payments as they fall due.”

The note said directors had concluded that it was appropriate to continue to prepare the financial statements on a going concern basis because the group was in positive discussions with its lenders to extend the maturity date of the facilities and reset financial covenants.

“The lenders have indicated their continued support for the business (subject to credit approvals and the requirements outlined above).”

The company confirmed last May that refinancing had been completed.

Asked for more details at the time, Nettlefold said: “The details of the debt facility amendment are confidential between the shareholders and our lending syndicate. Having said that, the board is confident that the revised agreement and our injection of capital provides the runway required to deliver on the company strategy.”

Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.

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