Speculation about the company’s future has been raging over the past week following reports that Usaha Tegas Sdn, the investment arm of Malaysian billionaire T.Ananda Krishnan, would mount a bid.
Bid rumours surfaced in several national newspapers and the financial website Bloomberg.com after City analysts predicted an offer was imminent.
And media commentator Roy Greenslade speculated that Usaha, which already owns 20pc of Johnston’s, would eventually take an even greater stake – “possibly a controlling one.”
But speaking to HoldtheFrontPage, Mr Bowdler issued a strongly-worded denial that the company, which owns 318 UK regional titles, was up for sale.
“There is absolutely no substance to and no basis for these rumours, period. They are utterly without substance,” he said.
The rumours, which were carried by the Financial Times, Daily Telegraph and financial website Bloomberg.com, appeared to have been sparked by a prediction from a City financial analyst, Jonathan Barratt, of Kaupthing, Singer and Friedlander, who believed the company’s shares were undervalued.
“Johnston Press could attract a bid from new 20pc shareholder Usaha Tegas given the very depressed valuation,” he wrote.
The round of bid speculation has been partly based on Johnston’s relatively high level of debt as well as its historically low share price – down around 80pc since 2005.
Last month it took steps to deal with its problems by raising £170m through issuing new shares and attracting a further £43m by selling off 20pc of the company to Usaha.
Mr Greenslade wrote on his blog: “My hunch is that there will be so much pressure, especially due to concerns about servicing its debt, that Johnston will eventually be sold.”
“Tim Bowdler will do all he can to avoid that, but – in the end – he will take a hard-headed rational decision to ensure that the company he has built up remains a going entity. Perhaps that will mean Usaha taking an even greater stake, possibly a controlling one.”
rebecca smith (23/06/2008 15:42:46)
I agree very much with this story. Perhaps this is why JP are making redundancies at their Peterborough site.
owen robinson (24/06/2008 00:09:38)
All newspapers are shafted … full stop.
Anon (25/06/2008 09:15:44)
It makes me laugh – the Malaysians must’ve thought “where can we get cheap labour?”, and found the answer in Johnston Press. A real reversal from British companies outsourcing to India for the poorly paid!