British Newspaper Deal Worth $1.98B
LONDON (AP) _ Trinity is buying Mirror Group for $1.98 billion in stock and cash in a deal that will create the largest regional newspaper company in Britain.
The deal marks the climax in a takeover battle for Mirror, publisher of the tabloid Daily Mirror. The new company, to be called Trinity Mirror, will own 155 newspapers and have a weekly circulation of more than 15.3 million and a daily circulation of 2.3 million.
``The merged group will have enhanced scale and financial strength providing a strong platform for future expansion,″ Trinity chairman Peter Birch said.
The union is expected to yield annual cost savings of $24 million by the end of 2002.
Trinity chief executive Phil Graf will become head of the new group, while Trinity’s finance director, Mike Masters, will be responsible for regional newspapers. Mirror’s head of national newspapers, Roger Eastoe, will keep that role in the new business.
``The strategic fit between our two businesses enables us to build further on our market-leading positions,″ Mirror Chairman Victor Blank said in a statement.
Secretary of State for Trade and Industry Stephen Byers approved the deal last week on condition that Trinity sell off its four newspapers in Northern Ireland, where Mirror Group already owns several titles. Byers said he was concerned that there needed to be a diverse ownership of newspapers in the region.
Trinity’s papers include the Western Mail, the Liverpool Echo and Daily Post and the Newcastle Journal. Mirror Group owns Scotland’s Daily Record and Sunday Mail along with the Daily Mirror.
The deal appears to shut the door on a potential third bid for Mirror, by an ousted former chief executive of Mirror Group, David Montgomery, who said last week he was trying to arrange backing for an offer.
The acquisition needs approval from shareholders and British regulators.
Trinity will pay the equivalent of $4.34 per Mirror share, well above the roughly $3.20 offered by rival bidder Regional Independent Media. Trinity shareholders will own 48.4 percent of the new company, with Mirror investors holding 51.6 percent.