Company behind The Post and ThisisBristol sold for £52 million
Regional publisher Northcliffe Media - which owns The Post and ThisisBristol - is in new ownership this morning after being sold.
The company, along with Iliffe News and Media, has been sold to a new consortium called Local World, led by David Montgomery.
The new group said it “intends to transform regional publishing to create a one-stop shop for local content to serve the community and business in every aspect of life.”
Northcliffe’s former owner DMGT will become a 39 per cent shareholder in the new venture as well as receiving more than £52m upfront.
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Other shareholders will include Iliffe parent company Yattendon, Trinity Mirror, hedge fund manager Crispin Odey and former Conservative Party deputy chairman Lord Ashcroft.
Steve Auckland, the former chief executive of Northcliffe, will continue in the same role with Local World, with Mr Montgomery as chairman.
The full statement from Local World can be read below:
Local World launches today: a media business dedicated to the optimisation of local content and commerce across all platforms. Created from the newspapers and websites of Northcliffe Media, the regional publishing arm of Daily Mail and General Trust (DMGT), and Iliffe News & Media, the publishing subsidiary of Yattendon Group, Local World intends to transform regional publishing to create a one-stop shop for local content to serve the community and business in every aspect of life.
Artefact Group, an Investment Fund associated with Lord Ashcroft, DMGT, Odey Asset Management, Trinity Mirror and Yattendon Group will be shareholders in the new company.
David Montgomery, one of the most experienced media executives in the UK, will be Chairman of Local World. Steve Auckland, formerly Managing Director of Metro, Yorkshire Post Newspapers and Northcliffe Media, will be Group Chief Executive. Rachel Addison, currently Chief Financial Officer of Northcliffe, will assume the same role at Local World. They will be supported by a management team drawn from Northcliffe Media and Iliffe News & Media.
Announcing the new venture, David Montgomery said: “This is an entirely new type of media business. The value of Local World will lie in its people, its franchises and its IP. It will be unencumbered by the infrastructure of the industrial past such as property, printing presses and large scale distribution or any legacy issues such as high levels of debt. Local World signals the fight back in Britain’s regional media industry.”
The management team led by Montgomery, a former Chief Executive of publishers Mecom and Mirror Group, intends to re-invigorate local newspaper publishing and the digital distribution of local content. The new business aims to build on leading regional media titles, with strong audience loyalty in local communities, and expand Local World’s digital presence with the investment of £10 million.
The new investment and the combination of Northcliffe and Iliffe titles will create a strong media business dedicated to the provision of first-class local content and advertising sales solutions. Local World will harness its proven publishing capabilities with new technologies to provide audiences – both print-readers and online consumers – with high quality, reliable and useful content in whatever format they choose. These plans and the substantial investment reflect the confidence of Local World’s shareholders in the future of local media.
Market leading brands
The combined product portfolio of 63 local portal websites has a monthly audience of over seven million unique users. The print business includes 16 daily titles, 36 paid weeklies, 40 free weeklies, two Metro franchises and a number of niche products including magazines. Famous brands include the Cambridge Evening News, Leicester Mercury and Hull Daily Mail. The combined print portfolio has a weekly reach of six million people.
First-class local content and sales
Local World has a vision to create comprehensive content for local communities and provide a range of solutions for advertisers to reach a local audience. The business will focus on the provision of content across multiple platforms, targeting opportunities for both digital audience and revenue growth. Print products will remain a prestigious part of the portfolio, complementing the digital offering.
Local World will meet strong demand for local content and commerce. Research conducted in 2011 by NS, the industry body, has shown that people continue to spend most of their time and money locally, that local media is the best way for brands to take advantage of the new ‘rise of local’ and that people act on local advertising.
The research revealed that:
• 80% of people spend half or more time within five miles of home, rising to 93% for 10 miles
• 76% of people spend half or more of their money within five miles of home, rising to 92% for 10 miles
• 81% of respondents felt the recession has made supporting their local community more important
• 93% like companies that involve themselves in the local community
• 45% of respondents trust local media content compared to 33% for national newspapers and 37% for television
• 60% have acted on local media advertising
Digital audience growth
Local World is committed to accelerating digital audience growth with the provision of rich online content, including relevant local news, information, entertainment and advertising. The overall audience for Local World’s outlets is expected to grow as increased focus is placed on digital distribution, with editorial resources devoted to increasing online traffic.
The new company, which will rely on digital for 8.4% of total revenue and 11.2% of advertising revenue at launch, aims to more than double its digital revenues to 20% of the total. A stronger digital offering will attract a younger audience, which will strengthen the overall offering to advertisers.
Local World aims to increase revenues by driving daily audience growth through enriched content. The investment Local World is making in audience measurement and profiling systems will enable it to create targeted and effective advertising solutions that deliver measurable results for local businesses.
New operating practices
A number of new innovative working practices will be put in place to help transform the business. Technology developments will enable better audience targeting for advertisers and e-commerce across all platforms. Increased use of remote working for staff and use of contributors will enhance online products.
Citing his experience at Mecom, where subsidiary Edda Media in Norway derived a quarter of advertising revenue from online and enjoyed digital traffic almost matching daily print circulation, Montgomery added: “Demand for local content remains as high as it has ever been. The correct strategic approach can transform a local media business focused on that opportunity. We look forward to satisfying this continuing demand and monetising our strategy.”
Incoming Group CEO Steve Auckland added: “Local World is a new beginning with a team dedicated to growing the local markets they serve. Our plans give us a real opportunity to produce a business that is positive, engaging and a pleasure to work with. This takes time, dedication and brilliant execution, and is somewhere everyone in media would want to work.”