INDEPENDENT Newspapers is in the running to buy the British regional newspaper group, Westminster Press, for around £300 million.
The group has entered the race for the newspapers in conjunction with Mirror Group newspapers. The group is a 46.42 per cent shareholder with the Mirror group in the London Independent newspapers.
A spokesman for Independent declined to comment. However, it is understood that the group is among four serious contenders for Westminster Press.
The others include United News and Media, Newsquest formerly part of Reed and backed by US financiers, KKR, and one financial bidder, thought to be CinVen, the venture capital group.
Westminster Press, whose flagship titles include the Brighton Argus as well as the Oxford Times, is currently owned by Pearson Group. The group also owns the Financial Times.
Any acquisition is likely to be funded through Newspaper Publishing, the holding company which controls the British newspaper titles the Independent and the Independent on Sunday.
Earlier this week, Davy Stockbrokers brought out a report highlighting tax losses at Newspaper Publishing of £70 million sterling.
These losses could make a British acquisition attractive, according to the brokers.
In addition, a £106 million rights issue by Independent Newspapers could also be used to fund the purchase.
Analysts also point out that neither the Independent nor the Mirror have substantial regional press holdings in Britain. In contrast, United News and Media already own United Provincial Newspapers, Britain's third largest regional newspaper business.
Although costs at Westminster Press have been radically cut, it is likely that more investment will be needed.
There is also speculation in British newspapers that the Daily Mail and General Trust has held talks with Pearson about purchasing some of the titles. According to the reports, the group could still launch a £320 million bid.
Although Pearson is understood to be seeking £300 million for the titles, circulation has been falling and this may be optimistic.
The deadline for sealed bids to the company's merchant bank, Lazards, also owned by Pearson, as expected to be the end of this week.
The move is also a signal that there are growing links between Dr Tony O'Reilly and Mirror Group.
