SYDNEY, Sept 30 (Reuters) - Australia's Seven West Media

said it would merge with Southern Cross Media

to create a A$417 million ($273.97 million) metropolitan and

regional media group designed to be more competitive against

global streaming giants.

Seven West shares, controlled by mining and media

billionaire Kerry Stokes, rose 14.3% in early trade on Tuesday

to A$0.16, while Southern Cross stock was up 10.75%. Stokes'

Seven Group holds about 40% of Seven West.

Under the deal terms, Seven West shareholders would receive

0.1552 Southern Cross Media shares for each share held.

The offer values Seven West shares at A$0.13 each, slightly

below the stock's A$0.14 closing price on Monday. The combined

group will be worth A$417 million based on the current market

capitalisations of both entities.

Southern Cross owns major radio networks and podcast

platforms across Australia, while Seven West holds metropolitan

and regional television licences. Southern Cross announced the

sale of its remaining regional television businesses to Seven

West for up to A$24 million in May.

Southern Cross shareholders will own 50.1% of the merged

group while Seven West will hold 49.9%, the companies said.

Free-to-air television in Australia, like all major

markets, has faced severe revenue and earnings pressure from

streaming giants like Netflix ( NFLX ), Paramount Skydance ( PSKY )

and Walt Disney ( DIS ).

"We have both (Southern Cross and Seven West) been on

the record as being substantial advocates of consolidation,"

Southern Cross CEO John Kelly said. "It needs to happen, we need

to take the mantle and really fight back against the global

behemoths."

The deal requires 75% support from Seven West

shareholders at a meeting that will be held in the first quarter

of 2026, the companies said, once the deal receives regulatory

approvals.

Communications and competition regulators, as well as

the Australian Securities Exchange, must sign off on the

transaction.

Seven West said that the board unanimously recommended its

shareholders to vote in favour of the merger, with all directors

also pledging to support the deal.

Seven West's current CEO Jeff Howard will lead the combined

entity, the broadcaster said.

The company added that both boards expect to record annual

pre-tax cost savings of A$25 million to A$30 million ($16.44

million to $19.73 million) in the next 18 to 24 months.

($1 = 1.5221 Australian dollars)