It was a most unlikely media marriage that yesterday brought together two of Britain's leading television and newspaper companies - Lord Hollick's MAI and Lord Stevens of Ludgate's United News and Media.
The move, which media analysts called "purely defensive", allies two potentially antagonistic partners: the left-leaning Lord Hollick, 50, friend to the Blairite-wing of the Labour Party, and Lord Stevens, 59, Baroness Thatcher's favourite Fleet Street publisher, whose Express newspapers supported the Iron Lady throughout her 12 years in power.
The agreed merger also heralded the beginning of the long-awaited consolidation of Britain's media industry. It could help both companies remain free from the clutches of larger media groups such as Carlton and Granada, which are considering plans to expand further in light of the controversial Broadcasting Bill.
Together MAI and United will control three national newspapers, two ITV companies, regional newspapers, magazines, a lucrative exhibitions business and the cash-rich money-broking arm that formerly fuelled MAI's growth.
How Lord Hollick and Lord Stevens will peacefully share corporate headquarters was the question on everyone's lips. The consensus in the City yesterday was that Lord Hollick will emerge the clear winner: he is the younger man and has the better reputation as a manager. "The two will not last long together," said a senior media executive who knows them well.
But fielding questions, the two men professed mutual respect and admiration. "He is a strategic manager, who thinks deeply about the business," Lord Stevens said. When asked what his own strengths were, he answered: "The same."
Lord Hollick was equally supportive of his new partner, although he made it clear who would be in charge of the combined operations. When asked who would get the bigger office, he responded with a smile: "That doesn't matter, as long as I'm running the show."
In the event, both men plan to move to United's Blackfriars offices, while MAI's London Bridge headquarters will continue to house its money- broking business. Lord Stevens will be chairman with Lord Hollick as chief executive.
The odd couple have at least a few characteristics in common. Both are sure of themselves in the company of other businessmen: articulate and somewhat humourless. But they are both capable of genuine warmth, even if the naked ambition that drives them is seldom far from the surface.
Lord Hollick was running his own company at the age of 29, inherited as a bankrupt concern when he was acting on behalf of merchant bank Hambros in 1974. He revived the company, formerly the old Mills & Allen poster site group, as MAI, and expanded into financial services. Together with Carlton and SelecTV, MAI bid successfully for the south of England ITV franchise in 1992, beating TVS. In 1994, he added Anglia Television. His business skill is highly regarded, and he wears his politics lightly in the boardroom. Asked whether the Express's support for the Tory party would change, he said: "I don't like the politics, but it would not make sense commercially for the titles to change."
In another admission that business takes precedence over political conviction, Lord Hollick had no compunction using a controversial "warehousing" scheme to push through the merger before the Broadcasting Bill becomes law. Under the scheme, the two companies will have no voting control over the Express titles but will derive the full "economic interest" until the law is in force.
Lord Stevens, better known in the City as David Stevens, had a long career in fund management and has spent 15 years at the head of United. During his tenure, the Express titles saw readership decline precipitously, as profits dwindled.
The merger with MAI had been in motion since early September, when Nicholas Cobbald, an executive of Knight Wendling, the head-hunting firm used by MAI, contacted Lord Stevens asking whether he would like to meet Lord Hollick. "We met and found we shared a certain view of the business," Lord Stevens said. "We then held a few more meetings and started to talk informally about how we might work together. I'm not sure who used the word 'merger' first."
Sources close to United confirmed yesterday that a merger had been discussed with at least two other potential partners last summer. They included Carlton, long believed to be a likely buyer of the Express Newspapers and Mirror Group, which has been actively seeking co-operative ventures with other newspaper publishers in an effort to share production costs.
Media battle, page 16
Fifty-year-old Labour Peer and chief executive of MAI, owned his own company at 29, when he took on a bankrupted company while working at the merchant bank Hambros. Has since built flourishing financial services and media company, crowning efforts with pounds 292m takeover of Anglia Television in 1994.
Lord Stevens of Ludgate
Fifty-nine-year-old chairman of United News and Media and for 15 years the driving force behind Express Newspapers. Following a career in the City, he took on the news titles in 1981 and masterminded the company's push into the exhibitions business. The newspapers remain profitable despite lost readership.Reuse content