The Australian Financial Review said in an unsourced report that Seven, controlled by media mogul Kerry Stokes, was considering two options -- a full privatisation, or a partial sale of around a 50 percent stake.
The latter option would be similar to Publishing and Broadcasting Ltd.'s
A buyout would value Seven at A$3.5 billion, of which $1 billion is equity and $2.5 billion debt.
The paper said the final structure of the deal would be pitched at a significant premium to Seven's latest share price of A$10.58 to secure the support of Seven's independent directors and win over minority shareholders.
The move would cash up Seven for takeovers next year when a law comes into effect allowing owners of one media platform -- newspapers, radio or television -- to own a second platform in the same market.
Seven has already positioned itself, grabbing a 14.9 percent stake in West Australian Newspapers Holdings Ltd.
Other industry heavyweights and private equity groups have been manoeuvring ahead of the anticipated media shake-up, although no date has been set yet for the relaxed cross-ownership and foreign ownership rules to come into force.
KKR was reported to have been pipped at the post in buying the 50 percent stake in PBL's media assets.
Rupert Murdoch's News Corp.
Irish media group Independent News and Media
KKR has been scouring Australia for assets, after having making its first investment in the country in June buying the Cleanaway waste management business and an industrial services business from Brambles Industries Ltd.
It led an A$18.2 billion attempt to buy Australian retailer Coles Myer Ltd.
Reuters DKS PM0530