(Corrects to show KKR has not yet sold the stake. Corrects value of stake in first paragraph. Removes paragraph 4 attributed to company chairman on reasons for KKR sale. Corrects role of KKR's Justin Reizes in new paragraph 4)
SYDNEY, May 21 (Reuters) - Seven West Media Ltd, owner of Australia's top-rated free-to-air television network, said on Tuesday that its major shareholder, private equity firm KKR & Co, was selling its entire A$265 million ($260 million) stake in the company.
Kohlberg Kravis Roberts & Co advised Seven West Media of its decision to sell its 12 percent stake following the close of the market on the Australian Securities Exchange, with brokers Goldman Sachs and Deutsche Bank taking orders for the stock.
"We will welcome our new shareholders following completion of KKR's sale of its shares," said Seven West Media Chairman Kerry Stokes in a statement.
KKR's Australia head Justin Reizes said the sale decision was driven by a range of factors on which the company based its initial December 2006 investment and returns sought over a planned 5-7 year stake in Australia's most watched network.
Over the past year Seven West has been on a cost-cutting drive aimed at offsetting weaker revenues from advertising in Australia's flagging economy and as it adapts to strong competition in the media sector from online and cable content competitors.
Shares in Seven West Media closed at A$2.28, down 3.39 percent. Bids for KKR's holding were starting at A$2.21.
Seven West Media went public in 2011 through a merger with West Australian Newspapers. The group is 33 percent owned by Seven Group Holdings, controlled by Stokes.
In addition to the Seven Television network, Seven West also owns The West Australian newspaper, 50 percent of web site Yahoo!7, and the country's second-largest magazine group, Pacific Magazines. ($1 = 1.0212 Australian dollars) (Reporting by Rob Taylor; Editing by Jeremy Laurence)