Johnston Press forks out £ 160m for Scotsman titles
JOHNSTON Press yesterday shelled out a hefty £160m to buy The Scotsman newspaper and two sister titles from the Barclay brothers.
But it indicated that it is still keeping an eye on Daily Mail and General Trust’s Northcliffe regional newspapers arm.
‘We are looking at developments with interest,’ said Johnston boss Tim Bowdler, who has splashed out close to £ 500m on acquisitions this year.
Johnston is paying a hefty 21 times last year’s underlying profits – far in excess of most recent newspaper deals – for the three Edinburgh titles.
Underlying profits of £7.7m last year on sales of £ 64m means margins are a thin 12pc compared to Johnston’s 36pc. But Bowdler reckons it will only take £1m of savings to push up group earnings. Job cuts are off the agenda for now.
‘ We need to get into the business,’ he said.
Johnston ( down
71⁄ 2p 450p) may also have to to spend on printing presses, since The Scotsman’s job cull is thought to be related to a £ 30m investment programme.
The billionaire Barclay twins, who bought the Daily Telegraph last year, are surprise sellers. They revelled in returning to their Scottish roots after paying £90m for the titles a decade ago. However, the Scotsman found the going tough as national newspapers invested in rival Scottish editions. A plan to gain scale by buying the Glasgow Herald was opposed three years ago.
Since taking the reins in 1994, Bowdler has transformed Johnston into one of Britain’s largest publishers. He insists national newspapers aren’t in his sights after broadening Johnston’s horizons from local titles such as the Falkirk Herald to the Yorkshire Post and beyond. DMGT hopes to sell Northcliffe next year. Analysts say it could raise £1.5bn.