Johnston Press — the debt-laden owner of The Scotsman, the i newspaper, the Yorkshire Post and about 200 local newspapers and websites — said on Thursday it has decided to “seek offers for the company.”
The share price of Johnston Press has fallen drastically in recent years to around 3p today, meaning the firm has a current stock market value of only £3.4 million.
In a stock exchange statement, Johnston Press said: “Since commencing the strategic review of financing options first announced in March 2017, the company has focussed on exploring all options available to it in relation to its £220 million outstanding 8.625% senior secured notes due for repayment on 1 June 2019.
“Pursuant to this strategic review and in order to assess all strategic options to maximise value to its stakeholders, the board of Johnston Press announces today that it has decided to seek offers for the company …”
Johnston Press chief executive David King told The Financial Times the company would struggle to refinance its 2019 debt payment.
“We have a refinancing need in nine months,” he told the newspaper, adding that consolidation in local news was “overdue.”
According to the Johnston Press web site, the firm’s biggest shareholders include Custos Equity AS with 20.01%, Ananda Krishnan Tatparanandam / PanOcean Management Ltd with 10.63%, Crystal Amber Fund Limited with 10.48%, Majedie Asset Management Limited with 9.87%, and Raymond Stanley Tindle with 6.00%.
Custos Group is headed by Norwegian entrepreneur Christen Ager-Hanssen.
In an internal email, CEO King told staff: “This process is about securing a positive future for Johnston Press.
“In the meantime, it is business as usual.
“Johnston Press is a strong and resilient business, with good profits and strong profit margins, great people and prestigious titles.
“I am certain that whatever the future ownership of the company, we will continue to produce our titles long after the end of the strategic review.”
The Johnston Press stock exchange statement continued: “The Panel on Takeovers and Mergers has agreed that any discussions with third parties may be conducted within the context of a ‘formal sale process’ (as defined in the City Code on Takeovers and Mergers) to enable conversations with parties interested in making a proposal to take place on a confidential basis.
“The company is not in discussions with any potential offerors or in receipt of any approaches at the time of this announcement …
“There can be no certainty that any offer will be made for Johnston Press, nor that any transaction will be executed, nor as to terms of any such offer or transaction.
“The board of Johnston Press reserves the right to alter or terminate the process at any time and in such cases will make an announcement as appropriate.
“The board of Johnston Press also reserves the right to reject any approach or terminate discussions with any interested party at any time.”