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Dorries backs Newsquest deal after warning over Archant titles’ future

Henry Faure WalkerNadine Dorries has cleared Newsquest’s takeover of Archant after being warned her threat to intervene could cause “irreparable” harm to staffing, titles and journalism at the regional publisher.

The Culture Secretary has approved the deal after Newsquest’s chief executive Henry Faure Walker warned her that its bid to rescue a number of “loss-making titles” at Archant would be hindered by Government intervention.

Ms Dorries announced in April she was “minded to” intervene in Newsquest’s takeover of Archant, which was confirmed the previous month, claiming there “may be public interest considerations” that “warrant further investigation”.

But now she has confirmed she has reached a decision to take no further action on the matter.

In a written statement, Ms Dorries said: “In light of the new information provided to me by the parties to the merger, I have decided not to intervene in the merger.

“The information provided by the parties addressed my concerns regarding the potential grounds for a public interest intervention, including the need, to the extent that it is reasonable and practicable, for a sufficient plurality of views in newspapers in each market for newspapers in the United Kingdom or a part of the United Kingdom.

“Officials have written to Newsquest and [Archant’s previous owner] RCapital to inform them that, without prejudice to my ability to intervene if new or additional information comes to my attention, I do not intend to intervene in the merger on media public interest grounds.”

A heavily-redacted version of  Newsquest’s case against the minister’s plan has now also been published by the Department for Digital, Culture, Media and Sport, with Mr Faure-Walker asserting that Archant “needs help now” after operating “hand to mouth” in recent years.

Henry, pictured, wrote in his letter to Ms Dorries: “The delays that a DCMS intervention will inevitably entail (from the associated regulatory process), may cause further harm to the Archant staffing, titles and journalism, much of which may be irreparable.”

Making the case for the deal, Henry said any overlaps between the publishers’ titles in East Anglia were “peripheral” – citing the example of Archant titles the Saffron Walden Reporter and Dunmow Broadcast and Newsquest’s Braintree & Witham Times.

He said there had been only one other bidder for Archant, although the name of the bidder has been redacted.

Henry went on to highlight Archant’s “parlous financial state” and claimed the “survival of its newspapers has been in question for some time”, claiming a number of its free titles are loss-making enterprises although the names of these were also redacted.

He wrote: “Working with the Archant team, a process is underway to get their loss-making newspapers back to health and to a sustainable position, importantly leveraging the scale and wider resources that Newsquest has. But this will take time.

“With Newsquest’s economies of scale, we intend to do our utmost to save these loss-making titles. Plans are underway to transition some of these loss-making free titles [redacted] using Newsquest’s expertise in this area, while also leveraging Newsquest’s lower cost base; but they are in intensive care and time is running out to rescue them.

“If DCMS were to issue a public interest intervention notice, it is very likely that the Competition and Markets Authority, for the purposes of their competition review required by the notice, would impose a hold separate order (as is their normal practice when investigating completed transactions).

“This would likely be very damaging to the prospects of getting these loss-making titles back to a sustainable position, using our expertise and common business resources to try to improve the titles for readers and advertisers before it is too late.”

Henry further noted it was Newsquest’s policy to “maintain a physical presence and office in our local markets”, adding the publisher has “absolutely no intention of reducing Archant’s front line reporting resource”.

He said the deal was a “very positive development” for Archant, explaining editors are given “complete editorial freedom” and stating journalists are already benefitting from Newsquest’s “greater legal resources”.

In conclusion, Henry wrote: “We hope that the very extensive information that we have provided in this representation is more than sufficient to ensure that there are no grounds for concern.

“This transaction is a very positive development for the Archant titles and we are very concerned to ensure that after such a period of instability, they can progress unencumbered and achieve their full potential. We would be happy to meet to discuss any further questions you may have.”

Since the takeover was announced, Newsquest has already started a restructure at Archant which has seen five senior executives – including CEO Lorna Willis and editor in chief Jeremy Clifford – leave the business.

Around 65 jobs are also believed to have been placed at risk of redundancy at Creative Life, Archant’s in-house advertising production and design services department.