BREAKFAST DEALS: Nine's time

CVC Asia Pacific may have found a way to fund Nine's senior debt, while PEP prepares its next Spotless move.

As CVC Asia Pacific battles to keep Nine Entertainment out of the hands of its creditors, the private equity firm may have found some very powerful allies. Apparently there has been strong interest in one of the key assets Nine has put up for sale, including from some of Australia's biggest media companies – could this be the first step towards recapitalisation? Meanwhile, Japan Airlines has Alan Joyce's ear, and Pacific Equity Partners keeps its Spotless options open. Elsewhere, what could James Packer's exit from Prime Media mean for Kohlberg Kravis Roberts and Seven West?

Nine Entertainment, CVC Asia Pacific, News Ltd, Telstra, Tatts Group

Some of Australia's largest companies are understood to be flicking through the information memorandum for Nine Entertainment's events division, as the deadline closes for expressions of interest. The Australian Financial Review lists News Ltd, Telstra and Tatts Group as being among those considering making bid for the unit, which includes Ticketek, Allphones Arena and Nine Rewards.

While expressions of interest are just that, Nine's private equity owner, CVC Asia Pacific, will no doubt take heart in the early attention. It's still scrambling to raise funds to service Nine's $2.7 billion in senior debt before it is due in February, and the company's events division is said to be worth up to $500 million.

However, CVC could come up against some resistance from the owners of Nine's senior debt, including Oaktree Capital and Apollo Management, who must sign off on any sale before the deal can go ahead. Remember, they're looking for an equity conversion.

Spotless Group, Pacific Equity Partners

Sources say Pacific Equity Partners is close to wrapping up its due diligence on Spotless Group, and the suitor is now expected to discuss its next move in-house, according to The Australian Financial Review. The suitor has also extended pre-bid agreements with the cleaning, catering and laundry services group, including PEP's right to buy 19 per cent of Spotless if it makes a takeover offer worth a minimum of $2.63 a share, so it can keep the deal alive.

But as the process drags on, investors appear to be losing patience – Spotless shares have fallen nearly four per cent this month to $2.37.

Qantas Airways, Japan Airlines

Just as Qantas Airways wraps up deal talks in Hong Kong, more may begin in Japan. Reports this morning put Qantas chief Alan Joyce in discussion with Japan Airlines chairman Masaru Onishi about a potential investment as part of JAL's planned $US6 billion float later this year.

Sources have told Reuters that JAL is looking for stable investors from its Oneworld alliance – it is also said to have tapped British Airways owner IAG – to buy a stake worth between 1-10 per cent, depending on the partner. Qantas and IAG are viewed as the most likely investors, given their size.

Prime Media, Lachlan Murdoch

Lachlan Murdoch locked in a 40 per cent return on his 2009 investment in Prime Media, after he sold his full stake in the regional broadcaster for $22.1 million. UBS is understood to have sold his 32.5 million shares for 68 cents each, or a two cent discount to their last trading price.

There is now speculation that Kohlberg Kravis Roberts might follow Murdoch's lead and sell out of its media interest, Seven West Media. According to The Australian Financial Review, the private equity giant has recently held investor presentations with brokers, which could bring the $280 million holding into play.

Ten Network, JCDeaux, APN News & Media, oOh!media

Another of Murdoch's media interests, Ten Network, appears to have received strong interest for its Eye Corp unit, with three media groups apparently vying for control of the outdoor advertising business estimated to be worth around $130 million, according to The Australian Financial Review.

France’s JCDecaux and local players APN News & Media and oOh!media are each said to have submitted proposals, although none of the parties has been told whether they will make it through to the next stage. And with Ten yet to set a deadline for the sale, deal watchers may have to wait a little longer for more concrete news.

Minmetals Resources

Fresh from bedding down its takeover of Anvil Mining, Minmetals Resources apparently plans to use its new assets to launch a wave of acquisitions through Southern Africa.

Minmetals Chief exective Andrew Michelmore has told The Australian he is searching for copper opportunities in Zambia, Namibia, Botswana, Tanzania and Malawi, as it targets fourfold growth through acquisitions in coming years. Luckily, with backing by China's state-owned Minmetals, the company will have deep pockets to dip into.

Rocklands Richfield, Shandong Energy

Also in the resources space, China's Shandong Energy is said to have lobbed a $202.4 million takeover bid at Australian coal explorer Rocklands Richfield.

According the report in The Australian, the unlisted state-owned Chinese company is willing to pay between 52 and 56.2 cents per share, compared to Rockland's last traded price of 29 cents. The suitors may have to try a little harder, though – you might remember that Rocklands knocked back a 56-cents-a-share offer from Jindal Steel & Power last year.

Wrapping up

The latest round of writedowns at Leighton Holdings will put more pressure on management to sell off assets and bolster the company's balance sheet. Leighton's finance boss, Peter Gregg, has said the company is close to selling its Thiess waste management unit, which could go for about $300 million, and Macquarie has also estimated that the company could raise another $300 million from the sale its listed investments in Devine, Macmahon and Sedgman, according to The Australian Financial Review.

Meanwhile, QR National is one step closer to challenging the Pilbara rail monopoly, controlled by BHP Billiton, Rio Tinto and Fortescue, after it officially outlined plans for a 600km line that would carry iron ore from mines there to the export port at Port Hedland, according to The Australian. The project could cost as much as $3.5 billion, so expect construction firms to line up for a slice of the action.

And finally, Macquarie Group has waded back into the property market to buy a new headquarters – 48 Martin Place, in Sydney – from Commonwealth Bank, according to The Australian. At 25,000sqm, its new HQ will be 5,000sqm smaller than their current home at 1 Martin Place. A more pessimistic columnist might suggest it could signal more staff cuts.

*An earlier version of this column incorrectly stated that BlackRock's World Mining Fund had significantly reduced its stake in BHP Billiton. The relative weighting of BHP Billiton in the fund has decreased as a result of the underperformance of BHP Billiton’s share price relative to other companies in the fund and an increase in assets under management in the fund.

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