Further consolidation in media sector
Trinity Mirror closing in on Local World
Update 14th: Trinity Mirror, owner of the Daily Record and Daily Mirror, today confirmed it is finalising a £200 million takeover of rival publisher Local World in what may spark a new round of consolidation in the regional media sector.
Talks between the two companies were first unveiled in the trade press in March this year and a tie-up between them, which could be announced within weeks, is almost certain to attract a competition inquiry.
Trinity Mirror is already the UK’s biggest regional newspaper group and Local World the fourth. A merger with Local World would create a group with a combined turnover of £860m.
The indicated price tag would mean Local World has doubled in value since it was formed in 2012 through a merger of local papers, many owned by the Daily Mail and General Trust. Trinity took a 20% stake in the business at the time. Daily Mail and General Trust owns 38.7% of the company.
Local World, which owns 100 titles including the Leicester Mercury and Nottingham Post, is led by David Montgomery, who became chief executive of Mirror Group Newspapers after the death of its previous owner Robert Maxwell. In 2000, he created the pan-European newspaper group Mecom.
Regional newspapers are struggling and consolidation now seems to be inevitable. Ashley Highfield, chief executive of Johnston Press, owner of The Scotsman, Falkirk Herald and Yorkshire Post, recently hinted that a merger was a possibility.
Trinity, whose 130 titles include the Manchester Evening News and Liverpool Echo, appears to be leading the charge, not only at regional level. The company has been in talks over investing in Richard Desmond’s Express Newspapers, publisher of the Daily Express and Daily Star.
Local World’s last reported adjusted earnings before interest, taxation, depreciation and amortisation were £38.9m.
The number of regional press titles in the UK has shrunk by more than 10% over the past decade and only last week Trinity announced the closure of the Nuneaton Tribune, the 19th newspaper it has closed in the past year.