Byers clears way for `Mirror' battle

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The Independent Online
STEPHEN BYERS, Secretary of State for Trade and Industry, gave conditional approval yesterday to competing takeover bids for the Mirror Group, clearing the way for one of the biggest changes in newspaper ownership since Rupert Murdoch gained control of The Sun and The Times.

In addition to The Mirror and Sunday Mirror, the group publishes the Daily Record, Scotland's biggest daily, and 70 regional newspapers, including Evening Mail (Birmingham).

Bids last year by Trinity, publisher of the Liverpool Echo and 100 other titles, and Regional Independent Media (RIM), whose papers include the Yorkshire Post, were put on ice while the Competition Commission investigated.

Clearing the bids, Mr Byers said he agreed with the Commission's findings that there were sound commercial reasons for any buyer to maintain the Mirror titles' traditional left-of-centre political stance. He also noted that Trinity and RIM had a policy of editorial independence for their newspapers.

Whoever takes over the group will find The Mirror in its healthiest state for some time, with executives predicting that by the end of the year it will have its first year-on-year circulation increase for 25 years.

The editor, Piers Morgan, has repositioned The Mirrorand taken up feel- good stories and campaigns - "Pride of Britain awards" for good teachers and nurses, a campaign for pensions for Gurkhas' widows and a campaign to get Manchester United back into the FA Cup.

City bankers representing Mirror, Trinity, RIM and private buyers, including the ousted Mirror Group chief executive David Montgomery, were deep in talks last night. Industry insiders have deemed Trinity the favourite to win any bid battle.

But Mr Byers' ruling may change that with its requirement that, if successful, Trinity must within six months sell its four Northern Ireland titles - including the Province's most lucrative newspaper, the Belfast Telegraph.

Industry analysts said this condition significantly changes the financial assumptions of a mooted Trinity takeover. The Belfast Telegraph, formerly part of Thomson regional newspapers, accounted for more than 20 per cent of Trinity's 1998 profits of pounds 84m.

RIM, backed by Candover Investment Trust, would face no requirement to make disposals should it succeed in agreeing terms with Mirror Group's board of directors and shareholders, which are dominated by big City fund managers such as Phillips & Drew. That would also be the case for any consortium led by Mr Montgomery or a foreign buyer.

The condition was added by Mr Byers after the Competition Commission delivered its verdict to him four weeks ago. He ruled that a merged group, which combined Trinity's commercially dominant Northern Irish titles with Mirror Group's national titles, would jeopardise the commercial viability of the Irish News, a privately owned nationalist title.

Trinity issued a statement to the stock exchange that it was studying the ruling. Some City analysts had expected the Cheshire-based publisher to announce an agreed bid for Mirror within hours of the Department of Trade and Industry's verdict, but those expectations were seemingly being put on ice last night.

Outlook, Business, page 21

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