SYDNEY — Sean O’Halloran has vacated the chief exec’s chair at troubled satcaster Australis Media’s Galaxy TV, but will not take up the post of head of entertainment at major producer Southern Star.
In October, O’Halloran said he would segue to Southern Star after a rescue package for Galaxy had been finalized. But O’Halloran has spent much of the last month in New York in frantic talks with bondholders to stave off insolvency proceedings .
“Early last week, he asked to be let out of our agreement and we reluctantly agreed so he could pursue matters with Australis,” said Southern Star exec chairman Neil Balnaves, refusing to discuss the matter further.
Early Tuesday, Galaxy reps admitted that while the company was not yet in receivership, outside efficiency experts were now running the satcaster so “there wasn’t much need for Sean to hang around.”
Galaxy, which is laden with more than $630 million of debt, is teetering toward bankruptcy but bought itself a small reprieve by selling $3.5 million worth of equipment to Denver-based United Intl. Holdings’ rural Oz paybox Austar.
Meantime, Balnaves confirmed he was shuttering the New York-based Southern Star Interactive. Established two years ago in partnership with Taft Broadcasting to develop CD-ROM products, SSI has clocked $276,000 in losses after tax and minority interests. It is understood total losses are about $575,000.
“We only ever established it as a research and development experimental unit. But CD-ROM doesn’t hold anything like the promise it did two years ago. The Internet has a lot more upside,” said Balnaves, adding that any future Internet sites based on Star properties would likely be developed out of house.
The writedown saw Southern Star’s half-year post-tax profit rise just 1.4% to $2.9 million. But sales revenue jumped 53% to $42.8 million while pretax operating profit jumped 15.5% to $4.8 million, largely owing to the $15 million July acquisition of U.K. producer-distrib Circle Communications. At present, sales and distribution of both companies are being integrated. In 1998, Circle’s TV hours will double to 70.
Balnaves said the company is mulling a further two acquisitions, one of which may be in Europe, but admitted a planned $7 million acquisition of the Natural History unit of Kiwi pubcaster TVNZ had fallen through.
In Oz, Star will deliver 370 programming hours in 1998, a record for an Oz-owned company. That includes renewals for drama series “Blue Heelers,” “Water Rats,” “Murder Call” and “Big Sky.”