New boss of Scotsman publisher tackles £450m debt
Sunday 08 February 2009
John Fry, the recently installed chief executive of Johnston Press, which crashed out of the FTSE 250 last year, has made his first hack at The Scotsman and Yorkshire Post publisher's estimated £450m debt burden.
KPMG, the big four accountant, is understood to have been hired weeks into Mr Fry's tenure, which started on 5 January, to lead negotiations with the company's banks. Johnston's bank facilities expire in September 2010, meaning new terms need to be agreed this year. Refinancing is expected to be completed in the summer.
The group, which also counts the Skegness Standard and Bognor Observer in its regional newspaper stable, had net debt of £465m as of 1 November. However, Johnston is believed to have trimmed this since.
Huge speculation has surrounded how Mr Fry will turn the group around. It has been suffering from falling advertising revenues. Media industry figures would like to see legislation that would allow it to merge with rival Trinity Mirror, which publishes more than 150 regional titles. Such a plan currently falls foul of competition rules.
Mr Fry, who joined from Norwich-based regional newspaper group Archant, succeeded Tim Bowdler as chief executive. He has led a shake-up of Johnston which will see former Scottish Power boss Ian Russell take over from Roger Parry as chairman next month.
Mr Russell has been a non-executive director since 2007. Mr Parry said late last month that it was "an ideal time for me to hand over to Ian to work with John Fry and the board to address the challenges ahead".
The Edinburgh-based group's shares closed at 7.1p on Friday, giving it a market capitalisation of £52m. The company's share price was 350p in 2007. Johnston's full year results are expected in March; in 2006, revenue was £607.5m, up £5.3m on the previous year.
Independent News & Media, the parent company of The Independent on Sunday and its sister title, The Independent, is looking to repay a €200m bond by this May.
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