overview

holdings

landmarks

     overview

This profile deals with the Mecom media group.

     introduction

Mecom is a London-based newspaper, magazine and printing group with minor broadcasting interests. Its holdings are located outside the UK.

The group was launched in March 2005 with £48 million private equity.

     expansion

In June 2006 Orkla announced that it had sold its media assets (which included some of Norway and Denmark's leading newspapers) to UK media executive David Montgomery's London-listed and junkbond-fuelled Mecom Group plc in a cash-&-shares deal reportedly worth €900 million.

The deal resulted in Orkla becoming Mecom's largest shareholder (with 20% as of mid-2006). As Mecom's sharemarket value at the time of the announcement was £120m there was an expectation that substantial fundraising would be needed to complete the takeover, likely to involve a large rights issue.

Sale by Orkla was criticised by the group's journalists, who described Mecom as the "worst alternative" and appealed to management to find another buyer for the newspapers, which had been put up for auction.

Montgomery is a former chief executive of Mirror Group in the UK. During acquisition of newspapers and other assets in continental Europe he has been criticised for "short-term investment, unrealistic demand, heavy cost cuts and little respect for editorial values and quality" ... an echo of attacks on peers such as Singleton and Ingersoll. Amanda Platell famously criticised him in the UK New Statesman in 1999, commenting that "For him, truth and falsehood were apparently neutral categories, to be used according to the tactical needs of the moment."

In 2005 Mecom agreed to buy the Berlin publishing group Berliner Verlag from Holtzbrinck for £53m. That deal was finalised in April 2007, with Mecom gaining the quality broadsheet Berliner Zeitung (daily circulation of approximately 185,000), East Berlin tabloid Berliner Kurier (daily circulation of 121,000), weekly freesheet Abendblatt (circulation 1.4 million) with an associated, fully owned freesheet in Warnow, and bi-weekly Berlin entertainment guide TIP, (circulation 61,000). Berliner Verlag also included a modern print plant which prints its own titles and other newspapers, including Financial Times Deutschland.
 
Mecom acquired the Hamburger Morgenpost (Hamburg's second largest daily newspaper) from Hans Barlach and Josef Depenbrock in 2006 and then bought Netherlands group LMG from the Telegraaf Media Groep for €200 million, before building a stake of around 30% in Wegener. That stake grew to over 85% in 2007.

The Guardian commented in November 2007 that Mecom revenue for 2007 is projected as £948m (up from £804m in 2006) but that ABN Amro estimates net debt will be around £502m by the end of the year.

     studies

There is no major English-language study of Mecom.







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