Independent group makes joint bid Scottish titles

Independent News & Media is part of a consortium that has lodged an expression of interest and an initial bid for the Herald…

Independent News & Media is part of a consortium that has lodged an expression of interest and an initial bid for the Herald stable of titles in Glasgow.

It is understood Soros Private Equity, the venture capital operation associated with Mr George Soros, is involved in the bid and that Independent might provide management expertise to the deal. Mr Soros and Sir Anthony O'Reilly were involved in the Valentia takeover of Eircom last year.

The Herald group of titles is expected to sell for about £180 -£200 million sterling (€286-€318 million). Analysts are doubtful as to whether Independent could be involved in making such a large purchase given its level of debt, but said involvement with a venture capital consortium would make sense and fit in with the group's ambitions. The consortium made its expression of interest last Friday.

The Herald group of titles is owned by the Scottish Media Group, which is quoted on the London Stock Exchange. The group, which announced its intention to sell the titles on September 10th and has interests in television, radio, newspapers and advertising, is selling its publishing wing to reduce the size of its debts.

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The group owns the broadsheet Herald; the tabloid Evening Times; the Sunday Herald, which was first published just three years ago; and a number of magazines. The two dailies have circulations of about 90,000 each, while the Sunday has a circulation of approximately 60,000. The Sunday Herald is this year's Bank of Scotland UK Newspaper of the Year. The bulk of the titles' circulation is in the Glasgow region.

The group is hoping to have a decision on a sale by the end of the year. If the titles are bought by an entity that already publishes newspapers in the UK, then it is likely the sale will require permission from the UK authorities. This process could take up to three months. A sale to a venture capital consortium would not require competition approval.

The group has received a number of expressions of interest. A spokesman said he would not confirm any particular expression of interest. Entities reported to have made a bid include the Edinburgh-based regional group Johnston Press, and the Barclay brothers, owners of the Scotsman titles. Associated Newspapers and the Guardian Group are also reported to have expressed an interest.

A spokesman for Independent said he would not be commenting on market speculation. In an interview in July with the Australian Financial Review Sir Anthony O'Reilly, chairman of Independent, said people who expressed doubt about his ability to make purchases in Australia should look at his European media aspirations in which Mr Soros would be involved.

He told the newspaper that APN News & Media, which is 45 per cent owned by Independent, was in the market for deals in Australia, despite its level of debt. He indicated he was interested in the purchase of John Fairfax Holdings, West Australian Newspapers or John B Fairfax's Rural Press.

Colm Keena

Colm Keena

Colm Keena is an Irish Times journalist. He was previously legal-affairs correspondent and public-affairs correspondent