Culture Secretary decides not to intervene in Newsquest takeover of Archant

Update 6 July 2022:

Culture Secretary Nadine Dorries has decided not to intervene in Newsquest’s takeover of fellow regional publisher Archant.

She made the decision after Newsquest chief executive Henry Faure Walker argued that the company “intend[s] to do our utmost to save these loss-making titles” using economies of scale.

In a letter, published by DCMS with many redactions, Faure Walker said some of Archant’s loss-making free newspapers “are in intensive care and time is running out to rescue them”. Newsquest intends to move these titles to a part-paid, part-free model, he added.

Faure Walker also said: “We have absolutely no intention of reducing Archant’s front line reporting resource. Once we have stabilised the Archant business (which has to be the immediate priority to give their titles a chance of a viable future), we will increase their investment in local journalism.”

Original story 26 April 2022:

The Culture Secretary has said she may intervene over Newsquest’s takeover of rival Archant.

Newsquest, which publishes titles including the Northern Echo and Lancashire Telegraph, sealed the deal to buy the East Anglia-based competitor last month.

On Friday Newsquest chief executive Henry Faure Walker told staff that several Archant executives including chief executive Lorna Willis and editor-in-chief Jeremy Clifford, as well as magazine managing director Jonathan Cropley and head of product and platform Ryan Cousins, would be leaving the business while its titles would be reorganised within Newsquest’s structure.

On Tuesday, Nadine Dorries said she was “minded” to issue an intervention notice, which would lead to the buyout being blocked.

The Department for Digital, Culture, Media and Sport said in a letter to Newsquest and Archant’s private equity owner Rcapital that Dorries is worried about the merger’s impact.

It said she has “plurality concerns” over how the merger could impact competition where the two firms operate, in particular in East Anglia which is where Archant is headquartered.

“The merger will see the two largest local newspaper groups in East Anglia combining,” the letter said.

“While news will still be available for consumers from other local and national providers (i.e. radio, TV and online), as highlighted in the letter shared by Newsquest with the CMA (Competition and Markets Authority), the majority of local newspapers will come under single ownership.

“Such concentration of ownership has the potential to impact the plurality of views available in local newspapers in East Anglia.

“This risk may be exacerbated by any potential restructuring within Archant’s titles, a possibility that has been subject to press speculation.”

Dorries has asked for reports by two watchdogs – the CMA and Ofcom – before deciding whether a full probe is needed by the CMA.

Newsquest, which remains the second biggest regional publisher in the UK after the buyout of Archant which was the fourth-largest, has said it had “no plans” to merge titles – although Faure Walker has said some redundancies are “likely”.

Newsquest has insisted it will give Archant’s news brands a “much more secure future”, noting the latter publisher had been facing financial difficulties in recent years before it went into administration about 18 months ago.

“It has had no money to invest in its business and unfortunately had to close a number of its local newspapers. None of the Archant or Newsquest newspapers or magazines compete with each other and there are no plans to merge any titles,” the publisher said.

“By bringing Archant and Newsquest together we will be able to give their titles a much more secure future and be in a position to invest in the great local journalism that both companies do.”

Picture: PA Wire/Victoria Jones