Regional Independent Media (RIM) has said that it is not interested in being split up by a consortium and that it intends to take its business public if no other suitable offers are received.
These comments come after Gannett, US publishing giant and owner of Newsquest in the UK, had made moves on RIM as part of a three way deal in which Johnston Press, Guardian Media Group and Gannett itself would carve up RIM newspapers businesses between them (see
Byers Clears RIM Bid Proposals). So far it has resisted all such approaches.
RIM’s defensive position comes as it unveiled a strong set of interim financial results. Advertising growth for Q1 was 12.5% and dropped back to 3.1% in Q2; this is still better than the Q2 decline experienced by rival publisher Trinity Mirror (see Profits Down At Trinity, But Above Expectations).
The rise in newsprint costs has hit the profits of most publishing groups. Despite this, RIM showed a pre-internet margin up from 20% to 26%, mainly as a result of cost cutting, according to ABN Amro. This will result in full year cost savings of around £4.5 million.
ABN says that RIM’s positive statement comes in contrast to the more cautious statements from Trinity Mirror last week, noting that some of this optimism may be a result of the fact that the group is effectively up for sale. While RIM was confident on the outlook, Trinity maintained that visibility is poor, says the broker.
