Montgomery plans Mirror bid

Ousted chief executive reported to be planning dramatic return with pounds 1bn offer

DAVID MONTGOMERY, the ousted chief executive of Mirror Group, is considering a dramatic return to the company via a takeover, according to two sources close to the man.

"He hasn't made a decision, but he's looking at the prospect," said one insider.

Mr Montgomery characterises the bid plan as "the next step" in a comeback not only for himself but also other City "outsiders". Mirror Group chairman Sir Victor Blank forced Mr Montgomery to resign last month after concluding that he had become an obstacle to selling the company in line with the wishes of Phillips & Drew Fund Management (PDFM), which holds a 22 per cent stake, and other major shareholders.

The first step in Mr Montgomery's comeback plan, according to people familiar with it, was the negotiation of a severance package worth pounds 1.4m.

Mirror Group's business is currently being studied by two declared potential bidders. Trinity, publisher of the Liverpool Daily Post and other titles, is close to making a new approach, according to City sources. Previous talks between Mirror and Trinity bogged down when Mr Montgomery balked at stepping aside to let Trinity chief executive Philip Graf run the combined company.

On January 18, Regional Independent Media, a newspaper chain backed by the venture capital group Candover, made an indicative offer of pounds 2 a share, valuing the Mirror Group at about pounds 1.1bn. But Mirror rejected it as too low. RIM/Candover is now considering bringing a higher bid to the table, according to City sources.

Mr Montgomery would enjoy an advantage over Trinity and RIM/Candover if his financial backing comes from outside the UK media industry. By law all bids by one British media company for another British media company are automatically subject to review by the Monopolies and Mergers Commission - a process that takes at least three months.

"Montgomery could wait until he sees the bids from Trinity and RIM/Candover, then, when those bids go under MMC review, come in, put his bid on the table, and say take it now."

Mr Montgomery denied he was planning a bid for the Mirror Group. "You're the third person to ring today about this rumour," he said. "It's rubbish."

Both the Mirror Group and PDFM said they knew nothing of Mr Montgomery's interest. But Mirror Group said that it would consider all bids in the interest of realising shareholder value. PDFM takes the view that Mr Montgomery remains a talented businessman for whom its door is always open.

Alerted to the possibility of a Montgomery bid, all parties concerned turned their attention to the question of who might back it. The general feeling was that German group Axel Springer is unlikely to emerge as a partner, but that, as one person put it, "Montgomery has a lot of friends in America."

Acknowledging that it would be consistent with Mr Montgomery's never- say-die character to attempt a dramatic comeback, most parties involved in discussions about Mirror's future expressed scepticism that he would be able to raise the pounds 1bn-plus necessary to mount a bid. "A billion is a lot of money," one said.

Mirror is due to report its annual results on March 4. The company expects that bids from Trinity and RIM/Candover could well emerge before then. PDFM is on record as saying that the true value of the company is worth somewhere in the vicinity of 250p per share. A straw poll of City analysts suggests the City values Mirror at between 230p and 240p per share.

"The funny thing is that PDFM might be prepared to take less for a cash and paper bid than a pure cash bid," said one source. "That would give PDFM a chance to realise a return and still look for value enhancement in the future."

Voices
On the last day of campaigning before the polling booths open, the SNP leader has written to voters in a final attempt to convince them to vote for independence
scotland decidesIs a huge gamble on oil keeping the First Minister up at night?
Arts and Entertainment
Rosalind Buckland, the inspiration for Cider with Rosie died this week
booksBut what is it like to be the person who inspires a classic work of art?
Life and Style
techApple has just launched its latest mobile operating software – so what should you do first?
News
A male driver reverses his Vauxhall Astra from a tow truck
newsThe 'extremely dangerous' attempt to avoid being impounded has been heavily criticised
PROMOTED VIDEO
Arts and Entertainment
Lionel Messi in action for Barcelona
filmSo what makes the little man tick?
Arts and Entertainment
tvReview: An undercooked end (spoiler alert)
News
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Pharrell dismissed the controversy surrounding
musicThe singer said 'the last thing I want to do is degrade'
Sport
Cesc Fabregas celebrates his first Chelsea goal
footballChelsea vs Schalke match report
Arts and Entertainment
Toby Jones (left) and Mackenzie Crook in BBC4’s new comedy The Detectorists
tvMackenzie Crook's 'Detectorists' makes the hobby look 'dysfunctional', they say
Life and Style
fashion

Olympic diver has made his modelling debut for Adidas

News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Recruitment Consultant - Soho - IT, Pharma, Public Sector

£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...

Sales Executive

£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week