Reach plc is the “frontrunner” to buy JPIMedia’s regional newspapers in a deal worth around £50m, it has been reported.
The Financial Times has cited “two people briefed on the negotiations” as confirming Reach is the preferred candidate for the titles, with one claiming “exclusive talks” were held over a possible deal last week.
The FT said the deal would not including national daily the i, and The Guardian last month reported Daily Mail owner DMGT was the leading bidder for that title.
According to the FT, a deal between JPIMedia and Reach would face potential scrutiny from the UK’s competition watchdog, but it has cited observers as saying the “dire situation in the newspaper industry” would make blocking the deal “unlikely”.
Reach and JPIMedia have both declined to comment on the claims.
Reach first confirmed its interest in JPIMedia in July, saying it was in the “early stages” of discussions to buy part of the company.
Former Local World chairman David Montgomery has also formed a new company, National World, with the aim of building a new publishing group, while Steve Auckland, who was chief executive of LW under David, is also rumoured to be mulling over a bid.
Others involved in the discussions include US-owned publishing giant Newsquest and Belgian media group Mediahuis which bought Belfast Telegraph publisher Independent News and Media in April.
DMGT made a previous bid for the i, believed to have been around £25m, when JPIMedia predecessor company Johnston Press was put up for sale last year, but the company declined to comment on the latest speculation.
After a brief period in administration, JP was eventually taken over by its debt-holders in a so-called “pre-pack” deal after concluding that none of the bids received for all or part of the company were sufficient to pay-off its £220m debts.
One offer of between £140m and £150m was also made for the whole of the JP prior to the company going into administration, while a separate bid of between £96m and £120m for the group, excluding national daily the i, was also received.
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Perhaps a financial journalist can make sense of the figures as it seems puzzling to me. £50 million for the regionals and £25 million for the i. So, £75 million now which is about half of what was offered prior to administration. That sounds like a bad deal for the rescuing companyJPI. What am I missing here? Are the regionals classed as just the evening papers and the weeklies will be left to rot?
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50 million? Surely a misprint? Somebody has added an extra nought in error, obviously….
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This deal should never be allowed to happen. Reach Plc already has too big a grip on the regional media. If and when its strategy fails than it would have a devastating effect on what remains of the local news industry.
Reach has grown massively in the past few years, not from investment in the newsroom and the excellence of its brands but by buying up rivals and giving content away free.
Surely it is better to offer up these produces not as a single entity but be broken up, so that potentially new and smaller players can enter the market. Of course this may not be possible but that would be real localism.
Having the same few editorial managers who have little experience outside of one newspaper group is too risky for the future of democracy and local press.
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So – a £50 mil bid for JPI regionals? That means Reach will be sharpening its axe for ‘efficiencies’ elsewhere – if they haven’t already started. Best of luck to everyone involved.
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@WYAnalyst and @PercyHoskins
I see this as a huge opportunity, particularly for any ex JP staffers or commercial people,to open up new weekly community newspapers in areas soon to be cast aside by Reach.
Like most other publishers they’ll have little interest in weekly print titles going forward which will leave the door open for a new competitor to emerge and capture the ready made market in those communities.
I’ve seen this happen so many times when the public and local business person wants a professionally produced grass roots local news service but the bigger publisher decides to leave their ailing titles to rot and instead throw their lot in 100% on monetising digital.
The jpi titles as is aren’t worth much so I doubt any outsider will want to buy the brands but their soon to be vacated areas and local communities are and that’s were the real opportunity lies.
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In the North East – Northumberland, Tyne and Wear, Durham and Cleveland, there is only Reach, JP and the lonely Northern Echo. This would mean an entire region dominated almost entirely by one publisher. Not good.
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