Former member of The Scott Trust Mike Unger has said it is “nonsense” to suggest The Observer was intended to have the same protections as The Guardian.
Former Manchester Evening News editor Unger sat on The Scott Trust from 1985 to 1997 and was present when the decision was made for the body to buy The Observer in 1993. The Scott Trust has owned The Guardian since 1936 and is also the owner of Guardian Media Group [GMG].
He spoke to Press Gazette as controversy rages around Tortoise Media’s bid to buy The Observer from GMG. No purchase price has been discussed publicly so far, but Tortoise has pledged to invest £25m into the Observer.
They quoted a comment made by Scott Trust chairman Hugo Young at the time when he said: “The trust safeguards will be fully extended to The Observer, which will be edited independently of The Guardian and retain its separate character.”
Unger recalled that Observer owner Tiny Rowland initially wanted £39m for the title when he approached GMG in 1992.
Unger told Press Gazette: “Jim Markwick [then-CEO of Guardian Media Group] went away and did some figures… He came back and said we should offer them £12m. It was making a loss of £12m a year, but he said we can turn it around within three years and if we don’t we will sell it.
“I don’t think any of us assumed it would ever make a profit, we did it really to please Hugo Young and Peter Preston [then-Guardian editor]. They desperately wanted the paper on board because they felt it fitted in with the ethos of The Guardian and so it was bought.”
Referring to brands all owned by The Scott Trust at the time, Unger continued: “It was very clear from the outset that the ethos of The Scott Trust was to protect The Guardian – not the Manchester Evening News or The Observer or Autotrader or anything else, it was to protect The Guardian.
“There was no question of it being absolutely sacred rather like The Guardian and The Guardian editor is. What’s going on is a bit of a nonsense really in terms of philosophy because The Observer was always vulnerable.
“I would guess it has never made money. And for a company like Tortoise to come along and offer to buy it I would think would be manna from heaven for them.
“The danger, of course, is the integration of certain editorial departments within the group, but that’s not a major problem.”
The Scott Trust’s purpose, as defined in 1992, is “to secure the financial and editorial independence of The Guardian in perpetuity”.
Press Gazette last week revealed that the minutes of a 1993 meeting of The Scott Trust discussing the Observer purchase said: “Mr Young felt that although we would want it to succeed, and it would have the benefits conferred to it as any other company owned by the Trust, The Observer couldn’t be viewed in the same light as The Guardian.
“Mr Jonathan Scott [another member of the Trust] said that The Observer fell outside the Trust’s core responsibilities and agreed while every effort should be made to make it profitable, it shouldn’t be to the detriment of The Guardian.”
Many of the 70 dedicated Observer staff fear for their jobs and the future sustainability of the title if it is bought by Tortoise Media (which is itself a loss-making publisher).
Tortoise Media founder and largest shareholder James Harding is expected to share more details this week about his business plan for The Observer and about who is funding the deal.
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