James Packer balks at Nine, ACP funding

Steps down from the board of PBL Media

SYDNEY -- James Packer has all but severed ties with the Nine television network and publisher ACP Magazines, the two pillars of the media empire that made his father, Kerry Packer, Australia's richest and arguably most powerful businessman for nearly 50 years.

On Monday, Packer stepped down from the board of PBL Media -- owner of both Nine and ACP -- while his media investment company, Consolidated Media Holdings, said it will not provide additional capital to the debt-laden firm.

CMH reportedly turned down a request from PBL Media last week to put an additional AUS$75 million ($45 million) into the group, which is struggling under AUS$4.2 billion ($2.5 billion) worth of debt, with its earnings just able to meet the interest payments on that debt.

"CMH no longer has significant influence over its investment in PBL Media ... (and) shall cease equity accounting for its 25% ordinary shareholding in PBL Media," Packer and his CEO John Alexander said in a statement as they resigned from the board.

PBL Media was formed as a joint venture between Packer and private equity group CVC Asia Pacific in 2006, with CVC paying Packer's then-gaming and media group Publishing and Broadcasting Ltd. AUS$4.5 billion for the Nine Network, ACP Magazines, online company ninemsn and several other investments.

PBL then sold an additional 25% stake in PBL Media to CVC for AUS$515 million in June last year, and subsequently separated its media and gaming investments into different listed companies. CMH now holds those media investments that include stakes in pay TV network Foxtel (25%), pay TV sports broadcaster the Premier Media Group (50%) and job Web site seek.com.au.