Fairfax Media to shed 1,900 jobs over 3 years

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By BY ROD McGUIRK, Associated Press

CANBERRA, Australia (AP) — Australian multimedia company Fairfax Media Ltd. announced Monday it will shed 1,900 jobs over three years as part of a restructure.

The Sydney-based company will shed almost one fifth of its 10,000 staff, spokesman Brad Hatch said.

The company also said that its The Sydney Morning Herald and The Age broadsheet newspapers will become tabloids and their websites will introduce pay walls from early next year.

Australia's largest newspaper publisher after News Corp. also said it would close two printing facilities in Sydney and Melbourne by June 2014.

Both sites have printing presses with significant surplus capacity which is no longer required, Fairfax said.

"Readers' behaviors have changed and will not change back," chief executive Greg Hywood said in a statement.

"As a result, we are taking decisive actions to fundamentally change the way we do business," he added.

Hywood said Fairfax devised the changes after considering the merits of a full range of structural alternatives, including a demerger.

"The package of strategic initiatives is bold, and several are difficult, particularly as they will impact on some of our people," he said

"However, we believe that they are in the best interests of Fairfax, our shareholders, and ultimately the majority of our people," he said.

"They are necessary to ensure Fairfax retains its position as a leading independent media company and a key voice in our markets," he added.

The measures will have a one-off cost of about 248 million Australian dollars ($251 million), and result in annual savings of AU$235 million from June 2014.

Fairfax shares rose more than 4 percent to 63 Australian cents in early trading on the Australian stock market after the announcement.

In New Zealand, the stock market on Monday morning temporarily halted trading in shares of Trade Me, an online auction site that is majority owned by Fairfax, while Fairfax sold down its stake.

Trade Me company secretary Linda Cox said in a statement that Fairfax sold 15 percent of the company to a range of institutional investors at a 3.2 percent discount to the closing price on Friday.

Fairfax raised about AU$160 million from the sale, and retains a 51 percent stake in Trade Me.

Fairfax owns more than 300 newspapers, 50 websites and 15 radio stations in Australia and New Zealand.

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Associated Press writer Nick Perry in Wellington, New Zealand, contributed to this report.

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