Welcome to the new Independent website. We hope you enjoy it and we value your feedback. Please contact us here.

Business News

Mail group set to hive off stable of regional newspapers

A former managing director of the commuter freesheet Metro will be unveiled as the chief executive of the Cleethorpes Post to Western Morning News newspaper empire Local World this week.

A deal that will see the group, set up by the former Trinity Mirror boss David Montgomery, merge the Daily Mail & General Trust's Northcliffe with Iliffe News & Media is "imminent", according to an insider.

It is thought that the Daily Mail and Mail on Sunday publisher, DMGT, is hoping to announce that it has hived off Northcliffe in a deal valuing the business at £100m, just six years after it was asking £1bn for the ailing regional newspaper empire, at its annual results on Thursday.

Mr Montgomery will be confirmed as chairman while Steve Auckland, Northcliffe's group managing director, will be chief executive. Mr Auckland joined Northcliffe last year after nearly a decade at Metro.

The vehicle is backed by a hedge-fund manager, Crispin Odey, while the former Conservative Party chairman Lord Ashcroft is also expected to get involved.

Although the deal is likely to be the highlight of DMGT's results, they could also hurt a major short-seller who bet that DMGT's shares would fall. Panmure Gordon analyst Alex DeGroote is hopeful about an advertising recovery after upbeat news from ITV and Trinity Mirror and pointed to strong profits at the FTSE 250 group Euromoney Institutional Investor, in which DMGT has a two-thirds stake. As a result, Mr DeGroote suggested a "short squeeze" on investors who bet the share price would fall is now "highly likely".

The US-based hedge fund Green Light Capital, led by David Einhorn, is the leading short-seller in DMGT, taking a position amounting to 4.4 per cent of the shares.