Government seeks meeting over Murdoch deal for Kells printing plant

Publisher of Sunday Times wants to take full control of Meath facility with 65 staff

The Government has sought a meeting with paper and packaging group Smurfit Kappa over a proposed deal to sell full control of a Meath newspaper printing plant to a company owned by News UK & Ireland, the Rupert Murdoch-controlled publisher of titles including the Sun and Sunday Times.

Leo Varadkar, the Tánaiste, last week wrote to local Sinn Féin TD, Darren O'Rourke, to say the Minister of State in his department, Meath native Damien English, has sought a meeting with the company to "discuss concerns expressed locally" about the proposed deal.

Mr O’Rourke has called on News UK & Ireland to honour a previous agreement between the 65 workers at the Kells plant and Smurfit Kappa over redundancy terms, if, as expected, some workers are let go after the deal closes.

It is understood that Smurfit Kappa has given assurances to workers’ representatives that a “pot” of €3 million will be set aside to help fund any shortfall between the previously agreed terms and any package that might be offered under News UK & Ireland’s ownership.

Fixed contract

The plant, which began operating about 20 years ago, prints all Murdoch titles in Ireland as well as the Irish versions of the Daily Mail and Mail on Sunday and the local copies of the Financial Times. The site and building are already owned by News UK & Ireland. The premises is currently leased to Smurfit Kappa News Press, which owns the printing press inside, employs the workers and runs the operation.

It is believed that News UK & Ireland is tied into a contract with Smurfit Kappa News Press for a fixed timeslot of usage, which has become relatively more expensive for the newspaper publisher over the years as the fee remained fixed while the number of newspapers printed declined along with circulation.

To, in effect, get out of the contract, News UK & Ireland has agreed a deal with the stock market listed Smurfit Kappa group to acquire from it Smurfit Kappa News Press, the leaseholder. Mr Murdoch’s company would then take over the Kells printing operation itself, following the proposed acquisition by its subsidiary, Kip Limited.

The proposed deal is currently being investigated by the State regulator, the Competition and Consumer Protection Commission (CCPC), which has launched a “phase one” examination.

Workers represented by Siptu staged a demonstration outside the plant in recent weeks, over fears that their future redundancy entitlements might be affected. Mr O’Rourke said he “shared their concerns”.

“I have been in correspondence with the Government and with Smurfit Kappa and they want to ensure a smooth transition,” he said.

Siptu organiser Teresa Thompson said it had a "good relationship" with Smurfit Kappa but it is "disappointed" by the sale. The union said it is "seeking assurances" from News UK & Ireland.

It is understood that workers have been told that their employment rights and conditions will be unaffected by the proposed deal. News UK & Ireland referred to a previous statement it made about the deal allowing it to “secure its longer term printing arrangements and route to market in Ireland”.

Mark Paul

Mark Paul

Mark Paul is Business Affairs Correspondent of The Irish Times. He also writes the Caveat column