Warning: file_get_contents() [function.file-get-contents]: URL file-access is disabled in the server configuration in /homepages/12/d83843876/htdocs/newlife/wp-content/themes/supernova-pro/lib/functions/supernova-query.php on line 657

Warning: file_get_contents(http://grant-adamson.me.uk/wp-content/themes/supernova-pro/lib/admin/inc/webfonts.json) [function.file-get-contents]: failed to open stream: no suitable wrapper could be found in /homepages/12/d83843876/htdocs/newlife/wp-content/themes/supernova-pro/lib/functions/supernova-query.php on line 657

Warning: Invalid argument supplied for foreach() in /homepages/12/d83843876/htdocs/newlife/wp-content/themes/supernova-pro/lib/functions/supernova-query.php on line 678
Categories

Wordblog revived

incorporating New Life

Does Montgomery plan a return to the Mirror?

The last paragraphs of James Robinson’s stories on the Observer’s media pages seem to be making a habit of giving rise to speculation (see also the previous Wordblog post).

Norwegian journalists have picked up on the final words of his story, Candover eyes Mirror, a week ago suggesting that David Montgomery’s Mecom company could be another bidder for the Daily Mirror.

Recently Mecom finalised details of its take-over of Orkla Media which leaves the Orkla group with a 20% shareholding in Mecom. This could increase if a loan note for £93 million is not repaid in two years and is converted into shares.

In those circumstances, it is not surprising that Norwegian journalists should be interested in what happens next. Kristine Lowe, a Norwegian journalist, wrote in her blog acouple of days ago:

The Mecom-Orkla-Mirror theory gained further momentum when Dag J. Opedal, Orkla’s CEO, told DN that Orkla would be a “supportive shareholder” in Mecom Europe, after Opedal had presented Orkla’s solid second quarter earnings yesterday. He said Orkla “has faith in Mecom’s growth and development plans”, but refused to comment on future investments.

Kristine is sceptical, pointing out a series of problems including the low profitability of parts of his new acquisition and the money he would need to borrow to buy the Mirror.

Yet… it would be sweet revenge for the abrasive Montgomery, who was forced to resign as chief executive of Mirror Group Newspapers in 1999, to walk back through the doors as owner.

His stated ambition is to own a pan-European newspaper business and has rapidly bought papers in Holland, Germany, Norway and Denmark.

The Mirror and its Sunday stablemates are expected to be put up for sale by its troubled current owners Trinity Mirror. And as Peter Preston points out today in the Observer, the Mirror is profitable and successful even with its half-year operating profit down to £37.4 million.

Back in April James Robinson (him again) wrote an article headed, Montgomery marshals European titles for attack on British newspaper market. In the context of what was then a bid for Orkla Media, he wrote:

The logic underpinning those deals is simple: the continental market is fragmented and ripe for consolidation. But few expect Montgomery to spend the rest of his days ensuring the sums add up at Denmark’s Berlingske Tidende. The continental acquisitions are a bridgehead back to the UK market, and the next time Montgomery walks into a British newsroom, it may well be as a proprietor.

If he does return, there will be little rejoicing on Fleet Street. Regarded as hard-working but humourless, he was once famously described as a man who could make the temperature in a room drop simply by walking into it. Those who know him well say there is a softer side to him, although few would claim he is one of life’s extroverts.

For the moment we have no idea if Montgomery is interested in buying the Mirror, or whether he could find the money which would be substantial. But there can be no doubt about his ambition to get back into British newspapers.

About

View all posts by

POST A COMMENT


No Responses

  1. Kristine says

    Exactly my thought when I read your article on The Guardian and evening papers this morning: those throwaway sentences.
    I like the way you structure your argument and yes, it would indeed be sweet revenge for Montgomery. Still, I think buying The Mirror contradicts Mecom’s current strategy if its latest (or next, seeing that the handover hasn’t taken pace yet) acquisition is anything to go by. The Orkla Media portfolio is characterised by decent circulation figures, low profit margins and is modestly priced (compared to UK papers) – does The Mirror fit that bill (I must admit I haven’t looked to closely at the figures in the latter case)? I think Orkla and Montgomery will have talked a lot about growing Mecom’s future portfolio, but I doubt The Mirror has been mentioned as part of those growth plans. Rather, I think the execs Mecom have brought on board from Orkla have been charged with increasing Mecom’s stakes in newspapers where they hold minority stakes and consolidate their position in the markets they’re already in. But then, will that strategy change if Montgomery eyes an opportunity to get his hands on The Mirror? If so, I’m not too convinced that Orkla, who is after all the biggest shareholder in Mecom, will look too favourably on such sudden change of hearts.