Traditional media may have been a vale of tears for most of its proponents over the past 15 years or so, but not for Richard Desmond.
Now the former owner of Channel 5 (below) – sold to Viacom for £463m in 2015, for a £359m profit – has agreed a deal to sell his Express titles which include the Daily Express, Sunday Express and Daily Star – to Trinity Mirror for £127m, more or less what he bought the original Express for in 2000. But Desmond has extracted a huge amount of cash in the interim, mainly by ruthless cost cutting.
The deal, which will need to be approved by the Competition and Markets Authority, leaves Trinity Mirror, owner of the Mirror newspapers and a large string of regional titles and websites including the Manchester Evening News and Birmingham Post, in a dominating position over much of the UK’s industry industry – if that’s where you want to be. Desmond’s OK! magazine is also included in the deal. Desmond will be a major shareholder in Trinity Mirror, which might prove a headache for CEO Simon Fox.
Back in the day the notion of Beaverbrook’s right wing, empire-supporting Express joining the left wing Mirror would have been regarded as preposterous. But money, or the lack of it, talks and this won’t be the only change on the cards in the once powerful UK newspaper industry.
The Telegraph is reported to be up for sale while the Guardian is still struggling to turn its online appeal to profit before owner the Scott Trust runs out of money. Even the Mail titles are battling declining ad revenues despite the success of Mail Online.
If the CMA waves through this deal – and it might not, having shown its teeth in thwarting Rupert Murdoch’s most recent attempt to buy Sky – then Murdoch and others will be looking at further opportunities for consolidation.
One entity that will be pleased with this deal is the Labour Party which will hope one of its right wing opponents has disappeared into a left-leaning camp. But Fox and co. may decide the Express is still better positioned with the Tories.