Aussie group finalises merger

<p>SYDNEY: Cinema advertising company Media Entertainment Group (MEG) </p><p>will be folded into Val Morgan following a friendly merger between the </p><p>two Australian companies. </p><p><BR><BR> </p><p>The takeover occurred as MEG was losing money because of price </p><p>competition and management instability. </p><p><BR><BR> </p><p>Its two major shareholders Consolidated Press Holdings and Publishing & </p><p>Broadcasting, both controlled by Australian media tycoon Kerry Packer, </p><p>decided to rectify the situation by combining MEG with the more </p><p>profitable Val Morgan, which has been expanding overseas. </p><p><BR><BR> </p><p>Val Morgan will focus solely on cinema advertising and plans to step up </p><p>its international expansion. </p><p><BR><BR> </p><p>"Val Morgan has a very good franchise so it makes sense to roll it out </p><p>overseas rather than try and reinvent the wheel by moving into other ad </p><p>mediums," said David Rouse, executive director of Val Morgan and former </p><p>managing director of MEG. </p><p><BR><BR> </p><p>Terry Savage, Val Morgan executive chairman, said advertisers would </p><p>benefit from the merger as the company had more resources to invest in </p><p>the old MEG business. </p><p><BR><BR> </p><p>The company has commissioned research on cinema advertising - to ensure </p><p>the medium is more accountable - and has launched a new media kit, </p><p>something MEG was unable to do because of shaky finances. Savage said </p><p>cinema advertising was increasingly becoming a global business because </p><p>the international cinema chains were looking for ad sales partners to </p><p>work with them globally. </p><p><BR><BR> </p><p>Within the next few years, he predicted the market would be controlled </p><p>by about three key players - Val Morgan, Carlton Screen Advertising and </p><p>RMB International. </p><p><BR><BR> </p>