Mirror publisher snaps up Daily Express owner in £127m deal
9 February 2018, 07:06
Publisher Trinity Mirror is to buy the owner of the Daily Express in a £126.7m deal, it has been confirmed.
The deal gives the company control of four national newspaper titles also including the Sunday Express, Daily Star and Daily Star Sunday, plus celebrity magazines OK!, New! and Star.
Trinity Mirror will pay an initial £47.7m in cash to Richard Desmond's Northern & Shell group, £59m to be paid between 2020 and 2023, plus shares worth £20m.
It will also put a one-off payment of £41.2m into the publisher's pension scheme and has agreed a plan for further top-ups totalling £29.2m up to 2027.
The company already publishes the Daily Mirror, Sunday Mirror, Sunday People and Daily Record as well as being the UK's biggest regional newspaper owner.
Trinity Mirror chief executive Simon Fox said: "This deal is a really exciting moment in Trinity Mirror's history, combining some of the most iconic titles in the UK media industry.
"It is good for our readers, good for our customers and good for our shareholders. Northern and Shell's titles have a large and loyal readership, a growing digital presence and a stable revenue mix and offer an excellent fit with Trinity Mirror."
The deal is expected to deliver £20m in annual cash savings by 2020, and enhance earnings for Trinity Mirror in the first full year of ownership.
Confirmation of the transaction confirms an exclusive story by Sky News at the weekend.
Trinity Mirror said Northern & Shell's publishing assets had performed well last year despite continued pressure on advertising revenues, thanks to online income and the partial reversing of cover price discounts.
It said underlying earnings were £34m "benefiting from operational and strategic reductions in printing and production, marketing and other operating costs".
Mr Desmond, who acquired the newspaper titles in 2000 for £125m, said: "The Express Newspapers and our celebrity magazine titles have been a key part of the Northern & Shell portfolio for many years, and I am immensely proud of building them into one of the largest newspaper and magazine groups in the UK.
"Today's transformational transaction is a logical and natural next step in the evolution and consolidation of the media sector and will create a larger and stronger platform serving all stakeholders.
"In Trinity Mirror we have a great partner, who will be an excellent steward of the business going forward and I am delighted to be able to retain an ongoing interest in the combined group."
Mr Desmond has made hundreds of millions of pounds from his ownership of the newspapers, and was similarly successful during a briefer period at the controls of Channel 5.
He made his first fortune as the proprietors of adult television channels and magazines.
The tycoon is now focused on a string of property ventures and a potential bid for the licence to run the National Lottery.
Shareholders of Trinity Mirror will be asked to give their backing to the acquisition at a general meeting later this month and the deal is expected to complete by 28 February.
Separately, the publisher issued a trading statement saying adjusted results were expected to be marginally ahead of forecasts with a decline in like-for-like revenues slowing in the second half.
It also put aside an additional £3m to cover the cost of civil phone hacking claims, which had been higher than expected, taking the total provision for the full year to £10.5m.
Shares rose nearly 10% on the update.
(c) Sky News 2018: Mirror publisher snaps up Daily Express owner in £127m deal