Daily Mail General Trust has sold Northcliffe to Local World for a £52m and a 38.7 per cent stake in the new venture.
Local World – a new consortium led by former Trinity Mirror chief executive David Montgomery – has also confirmed the purchase of Iliffe News & Media, whose owner Yattendon, takes a 21.3 per cent shareholding.
The two newest additions become the biggest stakeholders in Local World, ahead of Trinity Mirror’s 20 per cent, which cost 14.2m. The remaining shares have been bought by investors including Artefact Group (a company associated with Lord Ashcroft), and Odey Asset Management, according to Press Gazette.
Montgomery is the chairman of Local World and Northcliffe managing director Steve Auckland is now its chief executive.
Local World, which will employ 2,800 people, claims it will be worth £100m when the deal is completed at the end of the year. It takes on a portfolio of 107 newspapers (with a combined reach of seven million people) and 63 news websites (and a combined seven million unique users).
It plans to invest £10m into digital operations, which makes up 8.4 per cent of its projected income – a figure it hopes to increase to 20 per cent.
DMGT’s owners, the Rothermere family, have owned Northcliffe since 1928. It is the fourth biggest regional publisher with a weekly circulation of 4.5m. Ilife adds a further 840,000.
Local World’s weekly circulation will fall behind Trinity Mirror (9.6m), Newsquest (6m) and Johnston Press (5.5m).
“This is an entirely new type of media business,” said Montgomery. “The value of Local World will lie in its people, its franchises and its IP. It will be unencumbered by the infrastructure of the industrial past such as property, printing presses and large scale distribution or any legacy issues such as high levels of debt. Local World signals the fightback in Britain’s regional media industry.”
(Source: Press Gazette)