News that the British media executive David Montgomery has bought some of Norway and Denmark's leading newspapers was met with protests from journalists at the titles yesterday.
The Norwegian conglomerate Orkla has agreed to sell its media assets to Mr Montgomery's London-listed Mecom in a cash-and-shares deal reckoned to be worth €900m (£620m), though the terms of the transaction were not disclosed.
The deal will see Orkla become a significant minority shareholder in Mecom but Mr Montgomery's company will need a substantial fundraising to complete the takeover. This is likely to involve a large rights issue; the company's current stock market value is £120m.
The transaction came despite appeals from journalists at Orkla-owned newspapers to find another buyer for the assets, which had been put up for auction.
"We fear the slaughter of newspapers, and dramatic consequences. Please don't sell us to Mecom," said Jan Erik Skau of Fredrikstad Blad - one of the 31 newspapers in Norway controlled by Orkla.
The Norwegian journalists' union, Norsk Journalistlag, said Orkla had chosen the "worst alternative". It said Mecom and Mr Montgomery were "known for short-term investment, unrealistic demand, heavy cost cuts and little respect for editorial values and quality".
Mr Montgomery, the former chief executive of Mirror Group in the UK, has insisted he will invest in the newspapers that Mecom has been purchasing in continental Europe. He has also bought papers this year in Germany and the Netherlands. Each time, Mr Montgomery's reputation as a cost-cutter has attracted a storm of protest from journalists at the newspapers acquired.
Mecom has said it was pursuing a "buy and build" strategy, which has turned it from being an investment vehicle to an operating company. Mr Montgomery has said there is better value available on the Continent, compared with UK media assets, which he considers overvalued.
In Denmark, Orkla owns the Berlingske media group that includes the Berlingske Tidende newspaper, which dates from 1749. It also has media assets in eastern Europe.
While some Norwegian media companies were interested in buying Orkla, none reached the final round of the bidding.
Orkla said: "In the ongoing sales process, several alternatives have been thoroughly examined, including a Nordic solution for Orkla. Such solutions have not proven to be viable."Reuse content