$50m savings from 'synergies' as Fairfax cuts more print

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Cuts across Nine and Fairfax Media have been outlined to shareholders ahead of a vote on the merger, while the newsmedia company continues to cut NSW print staff.

A booklet outlines "potential cost synergies" amounting to at least $50 million a year identified by the partners.

Fairfax shareholders are due to vote next Monday on the merger with Nine Entertainment, which still needs regulatory approval from the ACCC, a decision on which is expected on November 8.

Meanwhile, Fairfax is understood to be continuing to cut print staff following the production "sharing" agreement with News Corp Australia which has already resulted in the closure of presses at Ormiston (Queensland) and Beresfield (NSW). The agreement saw printing of the Sydney Morning Herald move from North Richmond (NSW) to News Corp's Chullora print site in suburban Sydney.

Now GXpress understands that an entire team has been laid off at the North Richmond site - which was upgraded to print the metro daily and the Australian Financial Review - because of a decline in coldset printing.

The savings outlined in the booklet presented to the ASX are expected within two years of the merger, and include about $15 million from consolidating sales and commercial teams, a further $15 million from streamlining technology and product-related functions, and a similar amount from integrating Nine's digital business with that of Fairfax metros and eliminating corporate and head office cost duplication.

Content-sharing arrangements are expected to account for another $5 million in savings, but shareholders have been told that these are not dependent on consolidating newsrooms or reducing journalist numbers, including regional news operations.

The scheme booklet - prepared by Grant Samuels & Associates - deems the merger to be in the best interests of Fairfax shareholders.

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