Canadian media baron Conrad Black said on Wednesday he wanted to increase his stake in Australia's oldest newspaper group, John Fairfax Holdings Ltd, to 50 percent from 25, a day after meeting the prime minister.
However, Black repeated that he would sell out of Fairfax if there was no easing in Australia's current media ownership rules, which he described as "anachronistic".
Black said that although he could not rule out selling his stake to Kerry Packer, the suggested merger plan by Packer between his media empire and Fairfax was unlikely to suceed.  
Black told shareholders at Fairfax's annual meeting that he had said to John Howard in their first meeting since Howard became prime minister that he would like to raise his stake, which is held through Hollinger International Inc.
Black was asked by reporters after Fairfax's meeting just how much he would want to increase his stake to, if allowed. "Fifty percent," he said.
The media baron added that U.S. accounting rules effectively punished companies which had higher than 50 percent stakes in their associates. However, Black repeated that he would sell his Fairfax stake if he was not allowed to raise it further.  
"If the road is truly blocked, then obviously we are going," Black said. He added that Hollinger would not lodge any application for a higher stake until the government ended its study into media ownership and presented new ownership rules.
Under Australia's current media ownership rules, foreigners are prevented from owning more than 25 percent of a newspaper group or 15 percent of a television group. They also prevent a newspaper group owner from owning more than 15 percent of a television station in the same city and vice-versa. "These thing as they are now are very anachronistic," Black told reporters.  
In August, Packer's main media group, Publishing and Broadcasting Ltd (PBL) proposed a merger between PBL and Fairfax only if media ownership rules were liberalised. PBL owns top-rating Nine Network and 15 percent of Fairfax.
Black said PBL's merger proposal was unlikely to succeed while he (Black) was a shareholder. "He (Packer) would have quite a time getting that one through," Black said.
"I don't ever rule out anything, but I think that's fairly improbable. If Mr Packer wants to control Fairfax he's going to have to it the old-fashioned way and pay for it." Rupert Murdoch's News Corp Ltd owns five percent of Fairfax.  
"I know he's averse to doing that," Black said. He added he was not particularly interested in any stock swap deal with Packer which would leave him with a PBL stake.
Black said John Fairfax's profits were starting to improve.
Fairfax reported a 41 percent fall in net profit to A$87.4 million in the year to June 30, 1996.
"It's starting to look a little better now. Profits are affected by increased newsprint, they are affected by increased depreciation because of the plant at Chullora, cash flow rates are starting to improve a little bit," Black said. Fairfax spent A$330 million on a new printing plant at Chullora in Sydney.  
Fairfax chairman Sir Laurence Street told shareholders the slower Australian economy coupled with higher newsprint prices would impact on the group's final results for the 1996/97 year.
"Coupled with the state of the economy, Fairfax, in common with the whole newspaper industry, has had to face high newsprint prices and this, too, will impact upon our final results in the current year," Street said.
At 3.45 p.m. (0435 GMT) Fairfax shares were two cents higher at A$2.69, giving it a market capitalisation of A$2.04 billion.
-- Sydney Newsroom 61-2 9373-1800
