GMG Considers Sale of TMG to KKR, Bauer

18 Jan

Times are hard for the print media industry these days. As consumers flock more and more toward online news and less toward newspapers, many media companies are struggling to adapt and maintain profitability. One option currently being considered by the Guardian Media Group is the sale of stakes and offloading nonessential assets.


GMG, headed up by CEO Andrew Miller, has already offloaded assets like GMG Raido and Kable, a technology research firm. Now, news is spreading fast that they’re also entertaining the idea of selling their 50.1 percent stake in Trader Media Group. This consideration has attracted the likes of private equity firms like Kohlberg Kravis Roberts (KKR) and German media group, Bauer.


It’s currently rumored that KKR is considering a £1.8 bn bid for the stake in TMG, the sale of which could bring in about £600m worth of windfalls for GMG. Last year, the media company, which runs both The Guardian and The Observer, reported a pre-tax loss of about £75.6m. That’s down from a £9m profit the year before.


GMG has said it’s not actively seeking a sale currently, only that it is considering the idea and checking in on what the value of selling would be. The sale’s windfalls would help protect the company’s core newspaper business, and would probably be put into a low-risk investment fund.


Though pre-sale inquiries have already been made to GMG, the media company hasn’t yet begun negotiations or even appointed advisers. Another struggling media company, the Tribune Company, has recently emerged from bankruptcy protection in the U.S. and is now facing the sale of its assets as well.


Like GMG, Tribune is considering sales in order to streamline itself and have a core strategy and business to focus on. Simplifying assets by selling them off helps protect struggling companies and forces them to refocus on those aspects of the company that form its core.



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