The £220m deal completed in November included a clause which would have seen the Cambridge News and a group of sister weeklies sold on for £15.8m to Iliffe News and Media, which owned them before the creation of Local World in 2012.
However TM has now decided it would not be in its interests to proceed with the sell-on, and is instead paying a £2m “break fee” to the Iliffe group.
Trinity Mirror announced the move as it published its annual results this morning, on the day it also launched the first new national print newspaper for 30 years.
Today’s results, published as The New Day hit the streets for the first time, show overall revenues at the group fell by 6.9pc to £592.7m during 2015.
However with cost reductions of £20m – £10m higher than originally targeted – operating profits rose by 3.9pc to £109.6m.
The report also shows underlying digital publishing revenues grew by 21.9pc during the year, increasing from 32.4m to £42.9m.
However print publishing revenues were fell from £521.6m in 2014 to £485.9m last year, a drop of 9.5pc.
On the Local World deal, the report identifies a target of £12m a year of “synergy savings” starting from next year but anticipates restructuring costs of £20m during the current year, as well as capital expenditure on integrating the two groups’ IT systems.
It says the group is making “good progress” on the integration of LW within its regional division, and “finding opportunities to benefit from best practice.”
On the aborted Iliffe deal, the report states: “After extensive work on separation of the business over the past three months, the Board concluded that it was in the best interests of the company not to proceed with the disposal and therefore pay a break fee of £2m to Iliffe Print Cambridge Limited.”
As well as the Cambridge News, other titles that will now not be changing hands include the Herts & Essex Observer, Herts Mercury Series, Cambridge News & Crier Series, Harlow Star Series, and the Ely Weekly News, Haverhiil News and Newmarket News.
Commenting on the results, TM chief executive Simon Fox said: “I am pleased with the profit growth we delivered in 2015 despite the challenging print environment.
“Our significant efforts on improving our balance sheet over the past three years enabled the transformational acquisition of Local World. We are delighted to welcome the Local World team to Trinity Mirror and are making good progress with the integration of the two companies and finding opportunities to benefit from best practice.
“Whilst we expect print markets to remain difficult in 2016, the continued implementation of our strategy gives the Board confidence in our performance for the year ahead.
“We have today launched, The New Day. It is an exciting and innovative initiative which we believe fills a gap in the market for a daily newspaper designed to co-exist in a digital age.”
Other initiatives highlighted in the report included April’s launch of Britain’s biggest free weekly newspaper, the Manchester Weekly News, with a distribution of 265,000 across Greater Manchester.
It states: “The Liverpool Echo was re-launched in June and the Birmingham Mail was re-launched in October with other regional brands to follow.
“The new design reflects the changing media consumption habits of our readers with less focus on crime, more reporting on things to do in the city and improved coverage in areas such as football.”