Fairfax Media : Unsolicited non-binding indicative proposal from TPG Consortium

8 May 2017:

Fairfax Media Limited (Fairfax or Company) (ASX:FXJ) on the evening of Friday, 5 May 2017 received an unsolicited, preliminary, non-binding indication of interest from a consortium including TPG Group (TPG) and Ontario Teachers' Pension Plan Board (together with its affiliates, OTTP) (collectively, the TPG Consortium) to acquire Fairfax for a combination of cash and scrip consideration in a newly listed vehicle (Indicative Proposal).

The effect of the Indicative Proposal, if implemented, would be for the TPG Consortium to acquire Domain, Australian Metro Media, Events and Digital Ventures (excluding Stan) for cash consideration of $0.95 per share; while existing Fairfax shareholders would retain 100% of Australian Community Media, New Zealand Publishing, and shareholdings in Macquarie Media Limited and Stan, through a distribution to them of scrip in a listed vehicle containing those businesses and the existing Fairfax net indebtedness.

The key terms of this Indicative Proposal are summarised in Appendix A of this announcement.

The Indicative Proposal is subject to a number of conditions, including due diligence, shareholder approval at the Fairfax scheme meetings which would be required to implement the Indicative Proposal, and obtaining requisite regulatory approvals, including Foreign Investment Review Board (FIRB) approval.

The Fairfax Board of Directors is reviewing the Indicative Proposal. The Fairfax Board notes that there is no certainty that the Indicative Proposal is capable of being implemented given the complexity involved in splitting the businesses. This proposed split of businesses may not optimise shareholder value.

Fairfax shareholders do not need to take any action in response to the Indicative Proposal and the Fairfax Board will update shareholders when it has been fully assessed.

There is no certainty the Indicative Proposal will result in an offer for Fairfax, what the terms of any offer would be, or whether there will be a recommendation by the Fairfax Board.

Regardless of any potential proposal, the Fairfax Board believes that Fairfax has a very attractive future and that the Company is well positioned to continue to deliver shareholder value. Fairfax is continuing to progress the announced potential separation of Domain Group.

Macquarie Capital and Herbert Smith Freehills are advising Fairfax.