Johnston Press spends over €240m to become largest Irish regional publisher

JOHNSTON PRESS, the Scottish newspaper group, has splashed out more than €240 million to become the largest regional publisher in Ireland with the takeover of the Leinster Leader Group and Northern Ireland’s Local Press company.

Johnston, which bought the Kilkenny People in June, yesterday snapped up the Leader group for €138m in cash and debt and a further €95m for Local Press.

The takeovers will leapfrog Johnston above Independent News & Media and Irish Examiner owners Thomas Crosbie Holdings as the largest regional newspaper group in the country.

The biggest beneficiaries of the Leader Group sale are its chairman John McStay and solicitor Anthony Collins, the deputy chairman. Mr Collins will net around €12m from the takeover, while Mr McStay will get more than €7m.

Others to benefit include Teddy Fennelly, who will get €6m and Iain Stewart, who will receive €3.6m.

Johnston beat off stiff competition from other bidders to land the titles. It is believed the Irish Times offered around €100m for the company, while Meath Chronicle owners Celtic Media were also in the running.

The price paid by Johnston Press is some €60m more than what had been expected when bidding began.

The price tag includes the €18m in debts owed by the Leinster Leader Group, reducing the cash pay-out to shareholders to €120m.

Johnston will get the Leader’s new printing presses, but not the company’s property interests, which it will lease from the previous owners.

The Naas-based Leinster Leader Group publishes six newspapers - The Dundalk Democrat, Leinster Express, Leinster Leader, Limerick Leader, Offaly Express and the Tallaght Echo.

Johnston said total circulation of the Leader group titles was 92,000 of which 72,000 were weekly sales with the rest coming from its evening titles.

The company made profits of just over €2m last year on sales of €26m.

The acquisition of the Local Press Group, from venture capital firm 3i, will add 12 newspapers in the North including the Belfast NewsLetter and three titles in the south to Johnston’s stake.

Johnston Press said in a statement that it believes the takeover of the company “represents an attractive and complementary addition to its recently acquired portfolio of titles in Ireland.

“As well as extending Johnston Press’s presence in these profitable and well-established markets, the acquisition will also provide opportunities for operational and purchasing synergies,” the statement said.

The National Union of Journalists (NUJ) said yesterday that the price paid for the titles reflects the financial stability of the group.

“We hope with our pay negotiations with the Johnston Group throughout the UK and Ireland that the journalists who are at the heart of the editorial operations will see that fact reflected through pay increases,” NUJ national organiser Séamus Dooley said.

The takeover is contingent on approval being granted by the Competition Authority and Enterprise, Trade and Employment Minister Micheál Martin.