AUSTRALIAN CONSOLIDATED PRESS
In November 1932, (Sir) Frank Packer and a former Labor politician, E.G. Theodore (1884–1950), formed Sydney Newspapers Ltd. Almost immediately, it was paid £86,500 by Associated Newspapers Ltd (ANL), managed by Frank’s father, R.C. Packer, in return for a three-year agreement not to publish a Sydney afternoon newspaper in competition with the Sun. Restricted in what it could publish, Sydney Newspapers launched the Australian Women’s Weekly in June 1933. National in focus and with a topical edge, the magazine was edited by a founding investor in the company, G.W. Warnecke.
As the end of the agreement with ANL approached, Sydney Newspapers began to consider producing a daily newspaper. In January 1936, the two companies formed Consolidated Press Ltd. With Sydney Newspapers owning the majority of shares, Theodore became chairman and Packer managing director. Non-compete clauses protected ANL’s Sun and Sunday Sun on one side, and the Women’s Weekly on the other. The new company relaunched an ailing morning newspaper, the Daily Telegraph, in March. Consolidated Press was to be one of the two dominant newspaper groups in Sydney—along with John Fairfax & Sons—for the next four decades.
Consolidated Press’s first annual report showed a modest net profit of £11,950; it rose to £34,307 in 1937–38 after an increase in sales and advertising revenue, particularly for the Women’s Weekly. In 1938, the Herald and Weekly Times (HWT) offered some £350,000 for Consolidated Press. Theodore agreed with Packer’s cheerful view that, ‘If it’s worth that to him [Sir Keith Murdoch], it’s good enough to keep.’
In 1939, Consolidated Press launched the Sunday Telegraph. Warnecke, who believed that he was entitled to a one-third share in the company, resigned as editor-in-chief that year, and later sold his shares. By 1946, the company had formed a subsidiary, Conpress Printing Ltd, to print supplements and do commercial work. Consolidated Press also moved into book publishing by acquiring a controlling interest in Shakespeare Head Press Pty Ltd.
In 1948, the Chifley Labor government amended the Income Tax Assessment Act 1936 to counter the efforts of private companies to minimise their tax bills. Consolidated Press was one of the companies affected, with the Daily Telegraph attacking the legislation for punishing ‘those who have succeeded’. Packer and Theodore converted Consolidated Press into a public company, and bought ANL’s 170,000 shares for £1 each. In 1949, a year before his death, Theodore installed his elder son, John, as chairman.
In 1952, the Telegraphs savaged the Treasurer, Arthur Fadden, in the Coalition government for proposed changes to income tax laws; the obscure clauses in question dealt with the taxation of partnership assets. Two years later, Consolidated Press underwent an elaborate corporate restructure. Cairnton Ltd (named after the Packer mansion) and a Theodore family trust were registered in the Australian Capital Territory to receive the profits the empire earned and minimise taxation. Consolidated Press Holdings Ltd (CPH) was formed with an authorised capital of £2 million.
In 1955, Television Corporation Ltd, with around half the shares owned by Consolidated Press, was formed, securing one of Sydney’s first two commercial television licences (for TCN9). Consolidated Press’s 20th anniversary in 1956 was marked with a name change to Australian Consolidated Press (ACP). Next year, the executors in E.G. Theodore’s estate decided to sell their shares in Sydney Newspapers Pty Ltd (est. 1937). A Packer ally, J.V. Ratcliffe, masterminded a rescue operation that enabled Packer, whose resources were depleted by television, to buy the shareholding. Packer replaced John Theodore as CPH’s chairman.
A flurry of attempted expansion commenced in 1960. ACP and a Fairfax subsidiary formed Suburban Publications Pty Ltd to compete with Cumberland Newspapers Pty Ltd, bought by Rupert Murdoch in a backdoor manoeuvre to enter the Sydney market. ACP abandoned its first attempted foray overseas (involving the London News Chronicle and Star) when the opportunity emerged to buy into GTV9 for £3.6 million. Soon afterwards, Conpress Printing purchased the legendary Bulletin, which came with the Australian Woman’s Mirror. In 1961, ACP’s fledgling Observer was merged with the Bulletin, and the Woman’s Mirror was nominally merged with ACP’s Weekend (est. 1954). However, ACP’s takeover bids for another venerable institution, Angus & Robertson Ltd, failed.
ACP acquired property in Elizabeth and Park Streets, next to the main building in Castlereagh Street, enabling an expansion of company headquarters. Sir Frank executed a stunning coup in 1967 by hinting that he was considering selling his business, possibly to the HWT. The end result was that CPH increased its holding in Television Corporation and Murdoch was forced to sell his minority interest in the latter company. CPH won majority control of TCN9 and Melbourne’s GTV9, and the Packer family’s personal wealth was enhanced.
For all this, Packer had developed elaborate measures to hide the losses incurred by Daily and Sunday Telegraphs. He had long realised the necessity of producing an afternoon newspaper to use idle printing capacity, but his efforts to acquire a majority shareholding in ANL in 1953 had been thwarted by John Fairfax & Sons. Despite impressive sales, the Daily Telegraph had never been able to break the Sydney Morning Herald’s stranglehold on classified advertising, and had always been subsidised by the Women’s Weekly. In June 1972, Packer finally acceded to pressure from his sons, Clyde and Kerry, to sell the Telegraphs to News Limited for $15 million.
After taking over K.G. Murray’s Publishers Holdings Ltd, ACP became the largest magazine publisher in the southern hemisphere. As Clyde had fallen out with his pugnacious father, it was his younger brother who took over as chairman of CPH. Kerry moved aggressively to secure sports broadcasting rights in 1976–77, establishing World Series Cricket. In 1979, ACP, News Limited and the British pools entrepreneur Robert Sangster secured the Lotto licence granted by the NSW Labor government. However, various investment forays proved costly in the early 1980s.
In 1983, Packer worked with bankers to execute a privatisation of the empire that allowed him to pick up assets worth more than $220 million for less than half that price. But over at John Fairfax Ltd, young Warwick Fairfax’s attempt at privatisation was a disaster. In 1988, CPH bought key Fairfax magazines (including Woman’s Day and Dolly); it on-sold the Canberra Times to Kerry Stokes the following year. In 1987, TCN9 and GTV9 were sold to Alan Bond for $1.05 billion; three years later, on the brink of collapse, Bond Corporation sold the stations back to CPH for less than a quarter of the original price.
As managing director (1991–93) of CPH, American Al ‘Chainsaw’ Dunlap slashed costs and staff, and 300 of the 401 companies that now made up the group. In 1992, ACP was floated, netting Packer an extraordinary profit for the magazines. CPH was transformed into an investment company with shares in three key enterprises: the Nine television network, ACP Magazines and the American newspaper coupon insert manufacturer Valassis.
In the early 1990s, ACP obtained a 15 per cent stake in its old rival, John Fairfax Holdings, but was unable to gain control due to media ownership rules. In 1994, Publishing and Broadcasting Limited (PBL) was formed from a merger of ACP and Nine. PBL failed to secure the licence for Sydney’s casino, but in 1999 bought Crown Casino in Melbourne. Although gaming would become an increasingly important part of the group, PBL acquired a 25 per cent stake in Foxtel, a 50 per cent stake in Fox Sports and a 33 per cent stake in Sky News Australia. PBL’s investment in the telecommunications company One.Tel was disastrous, but there were more profitable investments in online classified sites SEEK and CarSales.
After Kerry Packer’s death in 2005, his son, James, became executive chairman of CPH. In 2006, immediately after limits on foreign media ownership were lifted, he sold half of PBL’s media interests to a private equity firm, CVC Asia Pacific, in a deal worth $4.6 billion; another 25 per cent was sold to CVC in 2007. That year, PBL was split into two companies, Consolidated Media Holdings (CMH) and Crown Limited. With cash freed to focus on gaming, Crown Limited invested in casinos in Macau.
In 2012, the Nine Entertainment Co. sold ACP Magazines to Germany’s Bauer Media Group. The Australian Competition and Consumer Commission rejected a takeover bid by Seven Media Holdings for CMH, by now centred on pay television*, but approved a bid by News Corp Australia. Approval by shareholders in November 2012 ended the Packer family’s control of any major media company.
REFs: P. Barry, The Rise and Rise of Kerry Packer Uncut (2006); B. Griffen-Foley, The House of Packer (1999).