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Fairfax NZ may share printing with APN; future of own plants in doubt

Fairfax Media [ASX: FXJ] has reached agreement with rival APN News & Media [ASX: APN] to have newspapers including The Waikato Times, Sunday Star-Times, Sunday News and some community titles printed at APN's modernised print facility at Ellerslie in Auckland.

The deal would allow APN to use spare capacity at the printing facility and help the publisher of the New Zealand Herald wring out cost savings, APN chief executive Michael Miller said.

The Australian company is on track to achieve a further A$20 million in cost savings across its publishing businesses this year, having trimmed A$40 million in 2013 from changes that included consolidating printing of a number of its own titles at Ellerslie, he said.

He said discussions with Fairfax had been "very positive" and the two publishers share "optimism for the ongoing viability of printed newspapers."

Fairfax CEO Greg Hywood said sharing a print site with a rival was "fairly common practice in overseas markets."

"In this instance we boost our print capacity in the upper North Island market without the need for significant capital investment and gain significant benefits from the additional scale and efficiencies," Hywood said in a statement to the ASX.

The agreement would see the printing work shifted from Fairfax's own facilities in Auckland and Hamilton, leaving a question mark over their future.

A Fairfax spokesman said the company's focus is on consultation with staff and no further comment would be made until that was concluded.

Fairfax shares last traded at 92.5 Australian cents on the ASX and have gained 45 percent this year. APN was last at 80 Australian cents, and has jumped 90 percent this year.

(BusinessDesk)

Comments and questions
2

Smart and about time

25 years from now, our children and grandchildren will laugh when they hear we got news from having pieces of paper pushed into gaps in our fences at 5:30am.

APN and Fairfax should be working out how to get rid of their print editions altogether, and working out how to charge for news online (perhaps bundled with a free tablet to read on?).