FAIRFAX MEDIA confirmed on Friday it has completed the sale of its stake in New Zealand online auction house Trade Me for $616 million, and dipped straight back into the sector with the acquisition of a tech investment company, Netus, for an undisclosed sum.
Fairfax, which publishes the Herald, paid $NZ700 million for the Trade Me business in 2006.
The Fairfax Media chief executive, Greg Hywood, said on Tuesday that the sale's proceeds would "provide us with a very strong balance sheet and the financial flexibility to invest and complete the company's structural transformation".
The sale cuts Fairfax's net debt to below $200 million.
While the Trade Me sale was supported by some of Fairfax's major institutional shareholders, it also deprives the company of a key source of digital earnings.
The Netus acquisition - which is understood to be in the tens of millions of dollars - is designed to address this.
The founder of Netus, Daniel Petre, said the company would be charged with finding "investments that can benefit from the traffic Fairfax can point at new businesses".
He said Netus would be looking for opportunities that "have the potential to move the dial in a reasonably short period" which he identified as three years.
Earlier this week Mr Hywood said the company was looking for small-scale digital acquisitions.
Netus will also focus on helping Fairfax's present digital business achieve better results.
"We think there is some scope here as well," Mr Petre said.
Netus claims success with previous investments such as ReachLocal and Travel.com.
Mr Petre and Netus's chief executive, Alison Deans, both worked with the Kerry Packer-backed tech investment firm ecorp and helped develop eBay's local operations, which Ms Deans headed.
Mr Petre set up Netus in 2005 with a $40 million investment from Fairfax rival News Ltd.
News sold its half share of Netus in May this year for $22.3 million, saying it wanted to focus its resources on "larger opportunities".