LONDON (Alliance News) - Johnston Press PLC Thursday confirmed it is in "late stage discussions" about potentially acquiring the i newspaper brand from Independent Print Ltd, but said the value of the deal is less than has been reported in the media.
The multi-media company noted recent media speculation about a potential deal with Independent Print, which purchased The Independent and Independent on Sunday titles back in 2010, with The Guardian suggesting a GBP25.0 million price tag for the i brand.
Johnston Press confirmed it is in discussions, but said the consideration for the deal would likely be around GBP24.0 million, and said that would be funded by its cash resources.
"There can be no certainty that the discussions between the company and Independent Print will lead to any definitive agreement concerning the possible acquisition or as to the final terms of any such agreement. Completion of the acquisition would be subject to the approval of shareholders of the company," said Johnston Press.
In its last financial year, Independent Print reporting a GBP5.2 million operating profit, according to Johnston Press.
Johnston Press said it believes the deal would grow its reach to over 600,000 paid copies per day - which would make it the fourth biggest print publisher in the UK. That, in turn, would also allow the company to increase its share of the national advertising market.
The Guardian reported that the i sells around 275,000 copies per day.
"i has growing circulation revenues, and new opportunities arise from: a proposed digital product; new geographic markets; and from potential cross-selling of i's advertiser base and vice-versa," said Johnston Press.
The company also believes it can accelerate its "digital transformation" by leveraging its digital expertise to fully realise the i brand across digital platforms. Johnston Press added its network enables cross-promotion to grow audiences at a minimal cost.
"It is also expected that the acquisition would be cash generative and immediately earnings enhancing," said Johnston Press.
http://www.theguardian.com/media/2016/feb/10/johnston-press-buy-the-i-newspaper-25m-deal
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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