The owner of the Daily Mail is planning to make an offer to buy the i newspaper from Johnston Press, which put itself up for sale last month, according to reports.
The Daily Mail and General Trust is set to make its bid for the daily title before a deadline set by advisers to JP at investment bank Rothschild, according to Sky News.
JP’s share price has gone up by 20 per cent following reports of DMGT’s interest in the publication, which first emerged on the weekend.
The Scotsman and Yorkshire Post publisher is looking for a buyer after struggling to refinance £220m in debt. It has said it would consider selling off parts of the business to potential buyers.
But JP’s largest shareholder, Christen Ager-Hanssen, has previously said he would not want to see the company broken up.
He said it was important that JP titles were kept together in order to keep “brand authority in their local markets”.
The Norwegian entrepreneur, who has a 25 per cent stake in JP through his investment firm Custos Group, has said he would block any sale that he did not approve.
Both the i paper and DMGT – which publishes the Daily Mail, Mail on Sunday, Mail Online and Metro titles – are based in Northcliffe House, just off Kensington High Street, London.
The i was previously owned by ESI Media, which publishes the Independent and Evening Standard. It was sold to JP in April 2016 for £24m.
The i made £6m in adjusted earnings (EBITDA) in the first half of 2018, helping to offset an 8 per cent fall in JP group revenues to £93m over the same period.
The low-cost daily has a circulation of 242,408, according to ABC figures for September, down 9 per cent year-on-year.
In its half-year results for 2018, DMGT revenues fell by £15m.
If DMGT were to buy the i, it would have a total circulation reach of nearly 4m, including 1.4m free daily Metro copies.
In a statement on its potential bid for the i, a DMGT spokesperson said: “We review all publishing assets that come to market, especially those where we can potentially leverage the scale of our existing national and international media operations.”
Press Gazette understands DMGT would not be interested in acquiring JP as a whole, which has more than 200 regional titles, and that it is seen as a good fit alongside the titles already owned by the group.
Reports of the DMGT bid come as a Sunday Telegraph report revealed that JP directors have put restructuring firm Alix Partners in place in case the publisher enters insolvency.
Johnston Press has declined to comment on the potential DMGT bid, but in a spokesperson did comment on the insolvency back-up plan.
They said: “The formal sale process is still ongoing. Nothing has changed since we announced that process to the Stock Exchange on October 11.”