INM sale raises concerns over freedom and diversity of press in South Africa
There is major public interest in who owns and funds Independent News and Media SA
Press freedom and diversity have become the central themes in a row between media houses in South Africa over the transparency of the sale of Independent News and Media’s local operation.
The war of words between Times Media Group (TMG) and Iqbal Survé, the executive chairman of the Sekunjalo Group, has been gaining in intensity ever since it was revealed last week that the government has a 25 per cent stake in the latter’s buyout of Independent News and Media SA.
The disclosure of the government interests was made by TMG’s Business Day publication, and it has led to a series of critical opinion pieces that have questioned the transparency of the deal in relation to its funding, sales terms and shareholder makeup.
There is major public interest in who owns and funds INMSA, especially given that South Africa’s print media transformation task team is looking into diversity of the print sector and the African National Congress has claimed that it is monopolised by four white-owned groups.
The task team was established last year after calls from civil society and parliament to speed up the transformation process in newspapers.
INMSA owns 15 of the country’s most widely read English language titles, including daily newspapers The Star in Johannesburg, The Mercury in Durban and the Cape Times in Cape Town.
The company’s accounts show it has about 27 per cent of the local market, so those behind the buyout would get a strong foothold in the market.
In February the Sekunjalo Group entered into an agreement with INM to buy its South African media house for R2bn (about €170 million), but the competition commission and South African Reserve Bank must approve the sale.
However, the identity of the remaining investors, whom media analysts say account for R1.2 billion of the buyout price, remains a secret which Dr Survé is unwilling to share.
In Sekunjalo’s submission to the competition commission, the company refers to the shareholders as “the black business community, labour movement, women’s groupings and poor people in urban areas”, according to Business Day.
This vagueness around the shareholders’ identity, and why a government pension scheme would get involved given the precarious nature of the print media market, has prompted his competitors to ask if there are ulterior motives behind the buyout.
In a column, Sunday Times business editor Rob Rose asked why the Sekunjalo consortium was keeping its shareholders’ identities secret, and suggested the deal might be aimed at securing political influence with government.
He wrote: “When people close to the ruling party put in a pricey bid for a ravaged newspaper company, and demand secrecy, it should ring all sorts of alarm bells.”
In response Dr Survé, who was Nelson Mandela’s doctor for a time, went on the offensive at a media awards ceremony he was addressing last Friday, and in a series of tweets since Sunday morning.
In his tweets Dr Survé accused TMG of “trying to hang onto their turf in challenging times”; of displaying a “supremacist” mindset; and of being biased towards South Africa’s main opposition party, the Democratic Alliance.
On June 17th, INM in Dublin is expected to clear the sale and restructuring of the print media group in a vote, and Dr Survé has said he expects the transfer of ownership to follow swiftly after that.
Whether the competition commission or the Reserve Bank can be swayed by the various arguments around the buyout that will be aired in the interim, and as a result block the sale, remains to be seen.