By Dominic Ponsford
Press
Holdings publisher Andrew Neil has given weekly newspaper The
Business a year to show signs of breaking even and hinted that if it
doesn’t it could face the threat of closure.
Neil was speaking as
he confirmed the sale of Scotsman Publications by the Barclay brothers
owned Press Holdings group to Johnston Press plc for £160m. Neil said
the sale came about after a speculative offer from Johnston Press. He
said that when other factors, such as Press Holdings’ continued ownership
of the Scotsman building in Edinburgh, are taken into consideration the
deal is likely to be worth around £200m to the Barclay brothers.
The
sale of the Scotsman leaves Neil in charge of a dwindling number of
Press Holdings assets: The Spectator, Apollo magazine, The Business and
women’s interest website Handbag.com.
He revealed that several
million pounds of the proceeds of the sale will be used to invest in
Handbag.com. Regarding The Business, Neil revealed that this year it
lost £3.5m and next year he was hoping losses would be under £2m.
He
said: “In the next year we have to at least show that it can break even
if we can’t get it to break even, or be seen to be close to break even,
then what is the point in continuing?”.
Neil
revealed that a
major reason for the decision to sell Scotsman Publications was Press
Holdings’ failure to acquire the Glasgow Herald group when it was
up for sale in 2002.
He said: “The attitude of the Scottish
political establishment during the take over battle of the Glasgow
Herald and its sister titles – that under no circumstances would we be
allowed to buy it- seriously curtailed our ability to be able to grow
to the appropriate size in Scotland that would allow us to deal
adequately with threats as various as the internet and the growing and
well financed Scottish editions of the London-based nationals.
“Johnston
Press is already a major Scottish based newspaper publisher which can
provide the size and economies of scale for TSPL [The Scotsman
Publications Ltd] to compete in such circumstances. As for Press
Holdings, of which TSPL is a part, we think we can get higher rates of
return by deploying our capital elsewhere.”
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