Speculation in South Africa over INM's plans

 

THE ONGOING financial woes at Independent News and Media in Dublin has sparked widespread debate about media diversity in South Africa, where the Irish company owns significant interests in the local print and online news markets.

Speculation in government and investment circles that INM will sell off its South African operations as part of cost-cutting measures has been rife since businessman Denis O’Brien became the leading shareholder in the company and ousted Gavin O’Reilly from its board of directors.

On Monday, during a parliamentary debate, the chairman of the portfolio committee on communications, Eric Kholwane, reportedly said INM South Africa should not be sold to a foreign buyer if it were put up for sale again.

“I don’t mind who owns it and some foreign ownership may be good. However, there must be a place for previously disadvantaged people to own a stake as this would help with the transformation issues concerning ownership,” Business Day newspaper reported Mr Kholwane as saying.

A report by submitted by Print Media South Africa to the communications committee last year revealed that black participation in the upper echelons of the South African print media industry currently stands at 14 per cent, and women in board and senior management is only 4.44 per cent.

White-owned groups Caxton, INM, Avusa and Media24 own the majority of the newspapers in the local market.

The Independent group in South Africa publishes daily newspapers across the country, including the Star, Pretoria News, the Cape Times, the Argus, the Daily News, the Mercury and a few others, as well as its iol website.

Local newspapers have also reported that a number of local consortiums have been eyeing INM SA as a potential investment, but as yet there has not been any official declaration of interest.

Johannesburg stock exchange-listed Sekunjalo Investment Holdings, which has as its CEO former African National Congress (ANC) activist Iqbal Surve, is said to be putting a bid together; while so too is ANC-linked businessman Cyril Ramaphosa of Shanduka Investment Holdings.

Both groups have declined to comment on their intentions when approached by reporters, and this has further fuelled speculation.

A lawyer source told Business Day: “We don’t know exactly who is in the consortium, but Sekunjalo is definitely there. They haven’t talked price yet.”

The speculation surrounding the ANC-linked firms has prompted opposition parties to warn that allowing consortiums with strong connections to the ruling party to gain control of such a big media group would be very dangerous for South Africa’s young democracy.

Last year business figures linked to the ANC set up a national daily newspaper called the Age, which is openly pro-government.

Parliament’s communications committee is scheduled to have public hearings on media ownership in Johannesburg on Monday.