Trinity Mirror Investment in Local World
Further to the announcement made on 29 October 2012 regarding a possible minority interest investment, Trinity Mirror today announces it has exchanged contracts to acquire a 20% equity interest in Local World Limited ('Local World') - a new company created to acquire and operate the regional publishing assets currently owned by Northcliffe Media Limited ('Northcliffe') and Iliffe News & Media Limited ('Iliffe').
Local World is acquiring the regional publishing assets of the Northcliffe and Iliffe businesses and will have an agreed enterprise valuation of circa £100 million at completion. On a pro forma basis, Local World would have reported revenues of £273 million and operating profit of £21 million for the twelve months ended 30 September 2011, and would have had gross assets of £38 million at that date.
The total consideration payable on completion by Trinity Mirror for its 20% equity interest will be £14.2 million in cash from existing resources. The investment is expected to be earnings enhancing in the first full year of investment. The transaction is expected to complete around the end of the year after necessary employee consultation procedures have taken place.
Local World will publish 16 daily titles, 36 paid weekly titles, 40 free weekly titles together with two Metro franchises and a number of niche print products including magazines, which together have a weekly reach of six million people. It will also publish a portfolio of 63 local portal websites, with a monthly audience of over seven million unique users.
Founder shareholders in Local World include Artefact Group, an Investment Fund associated with Lord Ashcroft, Daily Mail and General Trust, Odey Asset Management and Yattendon Group. David Montgomery will be appointed as Chairman of Local World and the business will be managed by Steve Auckland, currently Chief Executive of Northcliffe, as Chief Executive Officer and Rachel Addison, currently Group Finance Director of Northcliffe, as Chief Financial Officer. Simon Fox and Vijay Vaghela will be appointed to the Board of Local World as unremunerated non-executive directors.
Further details on Local World can be found at www.local-world.co.uk.
Simon Fox, Chief Executive of Trinity Mirror, commented:
"Alongside our continued focus on the creation of One Trinity Mirror, our investment in Local World reinforces our commitment to local media and enables us to participate in a compelling business opportunity with the consolidation of two strong local media businesses. In addition, the investment builds on Trinity Mirror's existing commercial services for the provision of contract printing and national advertising sales to Northcliffe. We look forward to working with the Local World team."