Guardian to sell off profitable Auto Trader in bid to improve rapidly deteriorating finances
Ian Burrell is Assistant Editor and Media Editor at The Independent, i paper and Independent on Sunday. He covers news from the whole media sector from television, press, radio and advertising to technology. His weekly column on the media appears every Monday in The Independent and i paper. He also writes on media, music and culture, including long-form pieces for The Independent’s Saturday magazine and the Independent on Sunday’s magazine, New Review. He is a regular presenter of BBC Radio 4’s What The Papers Say and a specialist commentator to Monocle 24 radio. He has contributed to most major broadcast outlets including BBC television and radio, CNN, Sky News, Al Jazeera and LBC. He has also written on media for GQ magazine. Ian has been reporting on the media industry for The Independent for more than a decade. Previously he was the newspaper’s Home Affairs Editor. He worked at The Sunday Times for five years, including as a member of the investigative Insight team, covering stories on political funding, industrial espionage and the arms industry. Previously he worked in ITV for London Weekend Television, on a weekly current affairs programme presented by Danny Baker. Ian trained at the Birmingham Post & Mail and was Regional Reporter of the Year in Press Gazette’s national awards.
Monday 03 December 2012
The Guardian has begun talks with the private equity group Apax to sell off its remaining share of the car advertising business Auto Trader in an attempt to improve its rapidly deteriorating financial position.
The newspaper’s owner, Guardian Media Group, reported a pre-tax loss of £75.6m in the year to the end of March and its newspaper and website operation Guardian News & Media made a loss of £44.2m.
On Friday, staff unions announced an “official dispute” with management over fears of compulsory redundancies. A voluntary redundancy programme aimed at cutting 100 jobs has found only 40 applicants.
News of the Auto Trader talks prompted comments that the paper was “selling off the last of the family silver”. The publisher has offloaded its regional newspapers, ending a historic connection with the Manchester Evening News, sold its radio interests and closed its television station.
Auto Trader has been an important source of revenue for GMG, although the company sold 49.7% of the business to Apax in 2007 in a deal that valued the stake at £1.3 billion. The private equity group is now seeking to activate a clause in that deal that would allow it to acquire the remainder of the business. Auto Trader’s weekly circulation has fallen by 31% in a year from 124,000 in September 2011 to 85,000 in September 2012.
But the Auto Trader business is still successful and it reported profits of £16.9m in the six months to September. The Guardian tonight reported that the talks with Apax were “tentative” and that a deal – which some accounts suggested could be worth as much as £600m – was “not thought to be likely to result in a transaction”.
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