Granada buys SMG stake from Mirror

Granada Group purchased Mirror Group’s 18.6 per cent stake in Scottish Media Group for pounds 110 million this week, adding a twist to the Mirror Group takeover saga.

Granada Group purchased Mirror Group’s 18.6 per cent stake in

Scottish Media Group for pounds 110 million this week, adding a twist to

the Mirror Group takeover saga.



The acquisition is still subject to shareholder approval, which Mirror

Group is obliged to seek at its extraordinary general meeting on 30

March, following complaints from Trinity, one of the companies

attempting to buy Mirror Group.



It is believed that Trinity was vehemently opposed to the sale of SMG on

the grounds that Mirror Group’s reduced debt eases the way for an

increased offer from rival bidder, Regional Independent Media.



A spokesperson for Trinity claimed to be neutral about the news. ’If

they want to sell it, they are perfectly entitled to do so,’ she

said.



Chris Oakley, chief executive of RIM, also said he had no objection to

the SMG sale. ’I don’t believe this has any affect on our plans. Mirror

Group has to get on with running its business the way it thinks best

while the Monopolies and Mergers Commission investigates (Trinity’s bid

),’ he commented.



Mirror Group regarded SMG, owner of the Herald newspapers, Scottish

Television and Grampian, as a non-core asset due to cross-media

ownership laws and is also understood to be looking to offload other

non-core assets including cable subsidiary, Live TV (Campaign, 5

March).



Granada has offered 915p for each of Mirror Group’s 12 million ordinary

shares in SMG. Granada denied that it planned to make a full bid for SMG

unless another party makes such an offer or builds a stake of 15 per

cent or more in the company.



Charles Allen, Granada’s chief executive, said: ’We are delighted to

have this opportunity to make this investment in Scotland’s premier

media company.’



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