Sekunjalo secures bid for Independent Media

On Sunday evening the current owners of the South African group‚ the Irish-based Independent News & Media‚ stated that it had selected the consortium headed by Sekunjalo as the preferred bidder to purchase its South African operations. Among the titles published in SA are the Cape Argus‚ The Cape Times and The Star‚ together with about 15 others.

The price tag settled on is R2bn‚ somewhat less than the R2.4bn to R2.8bn that the debt-laden Irish media group had been hoping for.

The Sekunjalo consortium secured funding from Citibank and used their global media investment team as transaction advisors.

Details of the rest of the Sekunjalo consortium will be released in about two weeks time as it has to prepare to meet regulatory requirements including obtaining permission for the deal to go ahead from the Competition Commission.

Surve said the consortium was a broad-based black economic empowerment group that included trade unions and a number of other parties from different parts of the country.

Guptas miss out

"From what I understand other bidders offered higher bids‚ but the Irish recognised ours as being the most professional and the one that could come through on the deal‚" Surve said on Monday morning.

Among the other hopeful bidders were the owners of The New Age newspaper‚ the Gupta family‚ who were also initially offering about R2bn and then tried to up their offer to R2.2bn‚ but that came in too late for Independent News & Media.

Independent News & Media has €420m debt to pay off‚ with the first payments due in March‚ and has been hard pressed to find the cash.

Its SA operations were among its most profitable assets with Independent News & Media SA having shown a profit of up to 32% of operating revenues in previous years.

"It is a good deal. We have bought at the right time. If we had to have bought this company two years ago‚ we would have had to pay double the price‚" Surve said.

He said other plans for Independent News & Media SA were to expand its electronic publishing and to increase the number of titles in vernacular languages.

"The website‚ iol.co.za‚ has more than 2.5-million unique visitors and this can be expanded upon. I would also ideally like to see every province having a newspaper title in the local language such as Sepedi in Limpopo‚" he said.

Into Africa

Regarding expansion into Africa Surve said once the deal had been finalised‚ he would like to expand into Mozambique‚ Angola and other Southern African countries.

"I also see a lot of opportunity on the African east coast‚ particularly Kenya‚" he said.

He went on to say that the deal meant that Independent News and Media SA was "returning home."

"I am an African optimist and I think the media has a very important role to play in developing the continent economically and intellectually‚" he said.

Surve‚ who developed strong ties with the ruling African National Congress during the apartheid years‚ said he was adamant that the group's editorial independence would be preserved.

"I am an independent thinker and I expect those who work on the newspapers to be independent too. However‚ I do believe that reporting should be balanced and fair‚" he said.

He said the name of the group may be changed once the deal had been completed.

At 12.27pm Sekunjalo's share price on the JSE was up 10% to 55c.