Westminster bidding falters on key issues
Tuesday 30 July 1996
As a result, a deal in now unlikely to be reached in advance of Pearson's results next week.
The 9 per cent stake in PA is being valued at nil by at least one bidder, while Pearson is holding out for a significant valuation. The bidding and selling sides are also far apart as well on outstanding tax and pension issues, according to the sources.
The leading bidders are a consortium made up of Mirror Group and Tony O'Reilly's Independent Newspapers and Newsquest, the regional newspaper group controlled by US buy-out specialists KKR. Two other bidders, thought to be Trinity International and Northcliffe, the regional newspaper arm of Daily Mail & General Trust, are believed to have bid only for parts of the group.
Final bids for Westminister Press were delivered to Pearson's advisers, Lazard Brothers, late last week. Pearson had hoped to realise as much as pounds 350m for the range of 60 regional titles, but the bidders have offered far less.
They are concerned that future profits may be far less than current year estimates, following severe cost-cutting in anticipation of the sale.
The outstanding tax issues are said to involve both the seller and the buyers, and could account for wide differences over the price Pearson expects and the offers on the table. "We haven't yet decided how much cash we can take out of the company, and what the tax implications are," a source at Pearson said.
The PA valuation is "not a deal-breaking issue," said an insider at one of the bidders. "But there is clearly some difference of opinion."
A Pearson source conceded last night it was "very unlikely we can conclude a deal before our results are announced."
The proposed sale has cheered the City, which has been pressing for further restructuring at Pearson, the book, newspaper and electronic publishing giant. The company has been investing in television and multimedia companies, and gradually selling non-core businesses. The regional newspaper operations were put up for sale a month ago, following a series of big disposals by other media groups of their regional titles.
- 1 This is what happens when you tattoo Charmander on yourself, drunk, and with no experience
- 2 BBC election debate: The one photo that summed up the whole 90-minute leaders debate
- 3 18th century sex toy found in 'toilet of sword fighting school' in Poland
- 4 The Batman v Superman: Dawn of Justice trailer has leaked – watch
The only black face in the Ukip manifesto is on the page about overseas aid
Ukip is the only main political party to not address LGBT rights in its manifesto
If I’m being racially abused I don’t need a white stranger with a saviour complex to rescue me
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
Russian warships in English Channel 'to conduct anti-aircraft and anti-submarine military drills'
iJobs Money & Business
£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...
£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...
£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...
£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...