News: Village Roadshow shares jump on Austereo sa

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Shares in Village Roadshow Ltd (ASX:VRL) closed almost 15 per cent stronger on Monday after announcing it had accepted Southern Cross Media Group’s (ASX:SXL) offer for its 52.5 per cent stake in radio broadcaster Austereo.

The theme park operator will receive initial proceeds of around $362 million from the sale which will likely result in a pre-tax profit of around $205 million. 

Village Roadshow intends to put the funds towards pursuing growth in China, investing in its film and music division and distributing $1 per share to shareholders in July.

At the beginning of the month the company sold its Sydney Attractions Group for $115 million to England’s Merlin Entertainment Group.

Yesterday shares in Southern Cross Media Group fell 1.49 per cent to close at $1.65. Shares in Village Roadshow climbed 14.94 per cent to close at $4.00.

In the first six months of the 2011 financial year, Village Roadshow generated a net profit of $48 million.