Consolidated Media Share Buyback

Consolidated Media Holdings (CMJ) has announced tat it will seek shareholder approval to buyback shares of the company. The share buyback look to acquiring up to 73.8 million shares, or about 11.9 per cent of its current shares on issue (620.7 million shares on issue). James Packer currently holds a 45.3 per cent stake in ConsMedia and Seven Network has a 22.1 per cent stake. The company has $225 million of surplus cash for the share buyback.

In the company's statement, Consolidated Media, admitted that there are disadvantages to minority shareholders if they approve the share buyback. The shareholders where warned that an increased stake of James Packer's and Kerry Stokes's interests "could result in the company being excluded from the ASX 200 index'', meaning fund managers who invest according to weighting on that index would not hold the stock and reduce demand for shares. Which may put urther downward pressure on the stock, allowing Mr Packer and Mr Stokes to mop up remaining shareholders and acquire and make the company private at a budget price.