Johnston Makes £52m Offer For Home Counties

Johnston Press has made a £52 million agreed offer to buy Home Counties Newspapers. The offer will be made on the basis of 500p for every Home Counties share, which is a 108% premium on Friday’s close of 240p. There will also be the opportunity for Home Counties shareholders to buy stakes in Johnston.

Johnston says that the acqusition will substantially strengthen its presence in the South East, especially among weekly titles. At the moment Johnston has 142 titles with a circulation of just over 4 million while Home Counties has 26 titles with a circulation of just under 700,000. The merger will be subject to the consent of the Department for Trade and Industry.

The move continues the consolidation within the regional press industry which has been occuring over the past couple of years: in 1995 Trinity International Holdings bought into Thomson Regional Newspapers in a deal worth £328m while in 1996 EMAP sold its regional business to Johnston Press and Reed Elsevier sold off its regional business which then became Newsquest Media. Newsquest then bought Westminster Press from Pearson for £305 million.

The main merger of 1997 occured when the Mirror Group gained approval from the Government to take over Midland Independent Newspapers, while United News & Media is still looking for a buyer for its UPN business. It was also announced today that Southern Newspapers is to take over the Bailey Newspaper Group for £35m.

Buoyant ad revenue and reduced paper costs have helped Johnston achieve record financial results throughout 1997, which have enabled it to be on the look-out for takeovers. Trinity International will, however, remain the biggest UK regional press publisher with a total circulation of over 8 million with Northcliffe coming in second. Johnston will now overtake UPN as the fourth largest UK regional publisher.

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Johnston: 0131 225 3361