Lonrho Sells Today Newspaper to Murdoch
LONDON (AP) _ Lonrho PLC, a diversified conglomerate, said Tuesday it agreed to sell its 90 percent stake in the money-losing Today newspaper to publisher Rupert Murdoch’s News International PLC.
News International will pay 38 million pounds in cash, or the equivalent of $61 million, it said.
Murdoch and his rival Robert Maxwell, publisher of Mirror Group Newspapers, had both sought to buy the colorful morning tabloid. Maxwell dropped his bid for Today on Monday.
Lonhro, which saved Today from collapse almost a year ago, controlled the newspaper, while its founder, entrepreneur Eddie Shah, retained a 10 percent stake in it. Lonrho substantially reorganized Today after the takeover last August.
Shah’s stake was not part of the deal with News International, said a Lonrho spokesman, who refused to identify himself further. Shah couldn’t be reached for comment. A man answering the telephone at Shah’s office said he wasn’t in.
Murdoch plans to take control of Today on Wednesday, if Trade and Industry Secretary Lord Young gives his approval, said Arthur Brittenden, a spokesman for News International.
But Brittenden added that if Lord Young doesn’t give his go-ahead by 4 p.m. local time Wednesday, the deal is off.
Brittenden said News International would continue publishing Today but that the newspaper would have a new editor, David Montgomery, currently the editor of Murdoch’s Sunday tabloid, News of the World.
The future of Today’s existing staff is to be decided later, News International said.
Today is expected to lose 30 million pounds in the year ending in September, the Financial Times reported. However, the rate of the losses has been reduced and the newspaper’s circulation - currently at 340,000 - and advertising revenue have been rising, the business daily said.
The newspaper, launched in March 1986, was Britain’s first electronically produced national daily newspaper.
Its launch accelerated a technological revolution sweeping through Britain’s national newspaper industry, which until last year was dominated by production methods outdated in other industrialized countries.
Maxwell, through his Pergamon Media Trust, had offered a deal worth 40 million pounds, or $64 million, with 10 million pounds, or $16.1 million dollars) of that in cash.
After the purchase, Murdoch will control three national dailies and two Sunday newspapers in Britain.
Murdoch’s media empire also includes newspapers, magazines, and television interests in Australia and the United States. His holdings include the Times of London, the New York Post and New York magazine.
Lonrho is headed by R.W. ″Tiny″ Rowland, a chief executive who received a lot of media attention in this country in recent years for his unsuccessful attempts to take over the famous Harrods department store.