Australian national news agency sold in binding agreement

Canberra: Australia’s national news agency has been sold in a binding agreement to a consortium of philanthropist investors who say they are driven by a desire to retain media diversity.

The consortium told Australian Associated Press staff in an email that they signed a binding agreement to buy most of the business on Monday.

The business will continue to be owned and run by its existing shareholders, including News Corp. Australia and Nine Entertainment Co., until a settlement period, ends on July 31, according to the email seen by The Associated Press on Tuesday.

The consortium is led by Nick Harrington and is made up of a number of investors including philanthropist John McKinnon. It has been supported by former News Corp. Australia chief executive Peter Tonagh.

The consortium stepped in after the AAP board announced in March that the Sydney-based news agency was to close after 85 years on June 26 due to a decline in subscribers and free distribution of news content on digital platforms.

“A consortium is a group of philanthropists and impact investors who share a common goal a desire to protect media diversity in Australia,” the email said.

“We feel the best way to do this is to ensure the long-term sustainability of the AAP news wire and its provision of independent, quality journalism on issues that matter to all Australians,” it added.

The new AAP will be run as a not-for-profit entity. There will be jobs lost, but numbers have not been announced.

AAP’s chief executive will be Emma Cowdroy, who has previously worked as AAP’s senior legal counsel. AAP editor Andrew Drummond will keep his job.

The consortium has bought the news wire text and image service including the full archive of stories and images and the fact-checking service. It has also bought the AAP brand, which will remain in use. Other parts of the AAP business remain the property of existing shareholders.

The consortium has not revealed a sale price. Newspapers owned by AAP shareholder Nine Entertainment Co. reported this month that the price would be one Australian dollar (69 U.S. cents).

Outgoing AAP Chairman Campbell Reid, a News Corp. Australia executive paid tribute to the professionalism of AAP’s more than 170 staff over recent months.

“You have all stayed true to the spirit that the news is published no matter what, and this stands the news wire in great stead as it begins its next chapter,” he said.