Struggling papers in the Indy stable face closure
A “PRIVATE and confidential” strategy missive by Sekunjalo Investments executive chairman Iqbal Survé, sent to all newspaper editors in the Independent News & Media South Africa (INMSA) stable, shows the group is on the verge of closing newspapers, despite offering the Competition Commission assurances of avoiding retrenchments when a Sekunjalo-led consortium bought the company last year.
Dated Wednesday June 4, Survé’s e-mail spoke of aims to restructure the group to become a content-driven company rather than simply a print company. He said the executive leadership team had been significantly strengthened, bringing on board seasoned industry personalities and new performance contracts were in place.
Editorial teams were set to be beefed up too.
Title performance benchmarks had been set in accordance with international practice, and budgets would be drafted on a weekly basis with preapproval and performance closely monitored.
Survé’s e-mail said INMSA was carrying some significantly underperforming titles/business units”, and task teams had been set up to improve performance.
“Should the task teams conclude that this is not achievable, then the difficult position to [sic] close some of the titles/business units will have to be considered,” Survé said.
“A preliminary review indicates that based on benchmarking of titles and on industry performance, many of the editorial teams cannot be accommodated in the titles/business units,” he said.
As part of the process, intended to wrap up by the end of August, there would be reallocation of editorial members to centralised content hubs and a scaling down of freelance contributors to save costs.
“I am also of the view that title editors need to be moved from their existing titles to other titles within the group. This is a common practice internationally and in business. It allows leaders of business, such as editors, to experience different titles with a different employee and market base.”
If insiders are to be believed, this stipulation is behind last week’s resignation of The Star’s editor, Makhudu Sefara. Philani Mgwaba quit as editor of Durban-based The Mercury last week, and it is understood that Survé instructed Sefara to move to Durban and replace Mgwaba. But Sefara refused, choosing instead to stand down “with immediate effect”.
INMSA’s current predicament mirrors concern expressed by the South African National Editors Forum (Sanef) before approval of last year’s buyout by Sekunjalo Independent Media (SIM).
In a letter addressed to the Competition Commission in May last year, then Sanef chair Nicholas Dawes said Sekunjalo had given an undertaking that it did not envisage any retrenchments. Dawes was worried about SIM’s commitment to media freedom, given that the buyers included a government entity, the Public Investment Corporation, and too many unnamed shareholders and loan providers, including a Chinese government entity.
Both the South African and Chinese governments have proved to be highly sensitive to, and critical of, an outspoken media, calling local media “hostile”.
In April last year, the Competition Commission noted that, “The proposed transaction will not result in retrenchments.”