Lachlan Murdoch is poised to return to the media sector by teaming up with Australian tycoon James Packer in a A$3.3 billion joint venture.

The pair plan to buy the Packer-backed publishing company, Consolidated Media Holdings, and split the business 50:50 in a deal that would mark Lachlan Murdoch's first big business move since leaving the media empire owned by his father, Rupert Murdoch, in 2005.

Mr Packer and Lachlan Murdoch began working together in the mid-1990s as co-investors in junior telecommunications company, One.Tel, which collapsed in 2001 owing A$600 million.

The failure resulted in a long-running court action by the corporate regulator against One.Tel founder Jodee Rich that led to court appearances by Mr Packer and Mr Murdoch.

The pair are again joining corporate forces. They have offered to take private Consolidated Media for A$4.80 a share, a 24.4 per cent premium to Consolidated’s last traded price on the Australian stock exchange.

The offer already has the blessing of Consolidated’s biggest shareholder, James Packer's Consolidated Press Holdings, which owns a 37 per cent stake in the business. Consolidated Media was floated at A$4 float price last December.

Australian newspapers said there had been rumours of Lachlan Murdoch's interest in the business, but said the news still took the market by surprise, especially since the leveraged transaction comes at a time when most of the world's markets are reeling from the credit crunch and financing for deals is scarce.

Lachlan Murdoch's investment does not put him in direct competition with his father's Australian media business, but it could result in a closer relationship between the two companies, given the 25 per cent stakes in pay-TV group Foxtel, held separately by Consolidated Media and News.

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