More FM breakfast host Simon Barnett and (inset) SEG chief executive Craig Hutchison and MediaWorks chief executive Wendy Palmer.

After almost 20 years of private-equity ownership, MediaWorks has been acquired by a media company that says its priority is growth rather than cost-cutting. Its new owner opens up: ‘It was something that we’d often admired and probably never dreamed of owning.’

MediaWorks’ new Australian owner says it plans toinvest in the Kiwi radio company following its $130 million acquisition, with sport set to play a key role in driving new audience growth and revenue.

Sports Entertainment Group chief executive Craig Hutchison told Media Insider in an exclusive interview that the acquisition was the biggest in SEG’s history - and transformational.

He was still buzzing on a phone call from Perth on Thursday, talking up the power of MediaWorks - and its potential - in the New Zealand market.

He said SEG had been a huge admirer of both MediaWorks and radio rival NZME. “It was something that we’d often admired and probably never dreamed of owning.”

In its announcement to the ASX, SEG said it had identified $A5 million of annual “synergies”, which would lift EBITDA of the combined SEG-MediaWorks companies from $A36.1m in the 12 months to June 30, 2026, to $41.1m.

The word “synergies” can do a lot of heavy lifting - it’s often a codeword for savings - but both Hutchison and MediaWorks chief Wendy Palmer have talked up revenue growth opportunities.

“We certainly would like to think that it’ll only be an additive experience as we gave guidance on this week,” said Hutchison.

“We’re not here to disrupt or change people’s favourite platforms - we’re here to support management, led by Wendy and Leon [director of content Leon Wratt] and their teams on the 10 great formats across the country.

“We’d like to think that anything we bring to the table is additive. We’ll come with support, investment, care, and we’ll look to see how we can help accelerate the strategy.

“We’ll sit down in the fullness of time and review what additional content or opportunities may exist for the business - and our business here [in Australia] in reverse - to accelerate that strategy.”

MediaWorks - currently owned by private equity firm Quadrant - operates top-rating radio stations such as The Breeze, More FM, Mai, and The Rock and digital platform Rova.

The new deal will mark the first time inalmost two decades that MediaWorks comes out from under private-equity ownership - and into the hands of another media firm.

Hutchison said the $A5m of synergies was a “very conservative number” for a company that was doubling in size. A key attraction was MediaWorks’ reach of 2.4 million New Zealanders, which Hutchison said offered significant opportunities for growth.

“We want to grow the business. That’s our model. We’re interested in growing scale.

“There’s a lot of backend bits and pieces that are caught up in that, but I won’t get into the specifics other than to say we intend to grow the business and to support local content and to grow its narrative into the country.”

In Australia, SEG - through its SEN brand - has a national network of owned and syndicated radio stations and holds broadcast rights across major sporting codes including the AFL, NRL, cricket, the NBL and the Australian Open.

Hutchison said the SEG model was based on investment in towns and regions of Australia. “We are big believers in the power of audio. We are big believers in the power of local media and local content. We understand the power of a local voice.”

Hutchison confirmed plans to build a sports content strategy in New Zealand, although it was early days.

“We’re a sports entertainment group as a business, so sport is clearly our product, as is entertainment. MediaWorks has done entertainment especially well.

“Clearly we’d like to do some more sport along the journey. We’ve got to work through that strategy.

“We’re really committed to sport. It’ll be part of our growth journey in New Zealand, it’s fair to say, but we’ll work through that and all the different ways that can be done over the coming months.”

Publicly listed SEG, whose major shareholder is Hutchison, had earlier exited direct ownership of New Zealand radio after selling its Senz sports radio network - now called Sport Nation - to the TAB/Entain in 2023.

SEG still sells advertising on behalf of Entain for Sport Nation, and Hutchison says this arrangement will continue. They were, he said, great partners.

But the obvious question is whether we might see a new sports radio network emerge out of MediaWorks.

“We’ve got opportunities to review the strategy, but we’re really supportive of our fabulous partner in Entain who we represent in the ad sales market, and we’ll continue to do so,” Hutchison said.

“Our sports strategy will be reviewed down the track, and we’ll work through what works for everybody.”

He said future plans - whether that was “in partnership with others, whether that’s in live rights, whether that’s in more shows” - would be reviewed.

“We’d like to do more sport, clearly. In what guise that comes, we are yet to consider. MediaWorks is already doing some great sport, through podcasts and streaming.”

The MediaWorks sale - announced by SEG and Quadrant on Wednesday - marks a significant turning point for the company after years of losses, restructuring and uncertainty about its long-term future.

SEG has said the acquisition will be funded through a combination of existing cash, a new senior debt facility from the Commonwealth Bank of Australia, and a fully underwritten placement to raise approximately $35m.

“We’ve been wonderfully supported by our financial partner, the Commonwealth Bank of Australia and by our shareholders, existing and new alike, who share with us the view that this is a great deal with a great strategy behind it,” Hutchison said.

“What an opportunity.

“I think it’s a really, really fair and good deal for our shareholders, which is my responsibility and obligation and reflects fair value and also reflects the great platform that it is.”

Hutchison said it was a “huge attraction” having the existing management stay in place at MediaWorks.

“Wendy, Leon, the sales and content leaders, and the strength of the talent across the country - that was really important for us. We just have high respect for that team. They’ve done a great job in the way that they have driven that business in recent years, and they deserve all the accolades and congratulations on this outcome.

“That was a huge part of the appeal for us, and we’ve been delighted that they’re going to join us in a whole new frontier.”

Hutchison said the acquisition was the “biggest moment” in the company’s history.

He hadn’t considered changing the name MediaWorks. “We’re 36 hours into some fabulous news ... that’s not been contemplated, but I would say it’s unlikely.”

The sale is scheduled for October 1, subject to conditions including approval from New Zealand’s Overseas Investment Office.

“It’s really exciting for us ... I think media is a wonderful product,” Hutchison said. “The spoken word is at the heart of the whole world.”

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.