Southern Cross Media Group Ltd (ASX:SXL) (SXL or Southern Cross) owns FM radio stations including the Triple M and Hit networks broadcast across the country. It also owns and operates the LiSTNR podcast platform.
While traditional media has been declining for a number of years, we consider radio has characteristics that make it a far more compelling medium than either print or television.
The Opportunity
SXL has faced distractions in recent years, notably proposals involving changes of control. In late 2023, a non-binding indicative offer for SXL was proposed, with an implied price of $0.94 per share. In mid-2024, this proposal was increased, but in the end no binding transaction could be agreed.
We believe SXL has valuable assets. The company trades at a substantial discount to our estimate of its intrinsic value, though we consider that its full value can only be realised with Board and management changes.
COMMENCED
Oct 2024
OPENING PURCHASE PRICE PER SHARE
~$0.51
THE ACTIVIST CAMPAIGN
We began private engagement with the company in early 2025, while our shareholding remained below the 5% disclosure threshold. We increased our shareholding above 5% in April 2025.
In May 2025, we decided to enter a public phase to allow for better shareholder communications.
Our recent letter to the SXL Board, outlining our concerns about recent announcements, including the decision to resume dividends, is available here.
INVESTMENT STATUS
Current
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Past performance is not indicative of future performance. The content of these case studies constitutes the views and opinions of Sandon Capital. They have been prepared without taking into account the objectives, financial situation or needs of any particular individual. The case studies do not constitute advice.
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