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MediaWorks explores TV business sale

New Zealand-based independent media company MediaWorks Holdings Ltd. is pursuing a sale of its TV business MediaWorks TV Ltd.

A sale would include the Three channel and the Flower Street property hosting MediaWorks TV's head office and studios, with a buyer getting a lease-back option to continue TV operations in the location, according to an Oct. 18 statement.

Following the sale, MediaWorks would retain ownership of its radio network and the recently acquired out-of-home, digital media and production business of QMS Media Ltd. in New Zealand.

MediaWorks Chairman Jack Matthews said tough competition among free-to-air TV operators, "alongside the structural hindrances we operate under," negatively impacted the company's TV business.

The New Zealand government earlier allowed state-owned broadcaster Television New Zealand Ltd. to continue operating despite incurring losses, with MediaWorks pushing to make TVNZ's TV One network free of commercials, Stuff reported.

CEO Michael Anderson reportedly said MediaWorks is open to changing the sale plans if the government makes changes to its broadcasting policy, which is under review.

MediaWorks tapped investment adviser UBS Group AG to identify potential buyers for its TV operations, according to Stuff.

Sky Network Television Ltd. and investment funds such as MediaWorks owner Oaktree Capital Management LP could take interest in acquiring the TV business, Newsroom reported.

Sky Network has reportedly looked at MediaWorks as an acquisition target, while investment funds could team up with local business people if they were keen on buying MediaWorks' TV operations.