21st Jan 2009 09:56
DMGT plc Disposal of Controlling Interest in the Evening Standard
21 January 2009
DMGT announces today that its newspaper division, Associated Newspapers Ltd, has agreed the sale of a majority interest in the Evening Standard for a nominal sum to Evening Press Ltd, a company formed by Alexander Lebedev and his son Evgeny Lebedev and owned by Lebedev Holdings Ltd. A new company, Evening Standard Ltd, will be established that will own the Evening Standard and in which Associated will be a minority shareholder with 24.9%.
Associated will continue to provide services, including printing and distribution, to the Evening Standard for an initial period, with the opportunity to extend these arrangements by agreement.
Alexander Lebedev is the major shareholder, alongside former President Mikhail Gorbachev, in the well-regarded and independent Russian newspaper, Novaya Gazeta. Novaya Gazeta is one of the few pro-democracy newspapers in Russia and has a reputation for high-quality reporting. Evening Standard Ltd will establish a new editorial committee that will safeguard the principle of editorial independence.
The Chairman of the Board of Evening Standard Ltd will be Alexander Lebedev. Justin Byam Shaw, an adviser to Lebedev Holdings, will be Deputy Chairman and Evgeny Lebedev will be Senior Executive Director.
Completion of the transaction is expected to take place in February 2009, following an employee consultation process. No other newspaper publication owned by DMGT plc is involved in the transaction.
Lord Rothermere, Chairman of DMGT plc, said:
"We are very proud to have owned the Evening Standard. It has a long and distinguished history as one of the world's great city newspapers, based on outstanding journalism. I believe that Alexander Lebedev shares my commitment to newspapers and will continue to invest in the Evening Standard. I would like to take this opportunity to re-iterate that DMGT remains fully committed to journalism and newspaper ownership."
Martin Morgan, CEO of DMGT plc, said:
"We believe that the agreement announced today is in the best interests of the staff and our shareholders. The investment planned by Mr Lebedev secures the future of the paper. DMGT will retain a 24.9% stake. We will continue to provide a range of support services to the paper but will not have a seat on the board or any involvement in its editorial policy. DMGT will benefit from the reduction in losses and will continue to invest in the development of our newspapers and other businesses."
Alexander Lebedev, Chairman of Lebedev Holdings, said:
"The Lebedev family is delighted to be investing in the Evening Standard. We are strong supporters of a free and independent press and we greatly admire the Evening Standard as an iconic publication with its pedigree of fine journalism and commentary. We are committed to strengthening the newspaper's competitiveness and look forward to working with Associated, which will continue to be involved as a minority shareholder."
DMGT plc was advised by Lazard & Co., Ltd on this transaction.
Enquiries to:
Peter Williams, DMGT plc +44 (0)20 7938 6000
Justin Byam Shaw, c/o Lebedev Holdings +44 (0)20 7993 3133
James Murgatroyd, Finsbury +44 (0)20 7251 3801
Lazard & Co., Limited, which is regulated in the United Kingdom by the Financial Services Authority, is acting for DMGT plc and no-one else in connection with the transaction and will not be responsible for to anyone other than DMGT plc for providing the protections afforded to clients of Lazard & Co., Limited nor for providing advice in relation to the transaction.
Notes to Editors:
Alexander Lebedev, 49, is the Chairman of the Board of Directors of the National Reserve Corporation, based in Russia. The National Reserve Corporation is the majority shareholder in National Reserve Bank, one of Russia's largest banks. Through the National Reserve Bank, Mr. Lebedev currently owns 30% of Russia's flagship airline Aeroflot, as well as shareholdings in Ilyushin Finance Co, Sberbank, Gazprom, and Unified Energy System. The National Reserve Corporation also owns the National Mortgage Company and has interests in the textile, food, chemical, energy, telecommunications, transport, and tourism industries. Together with former President Mikhail Gorbachev, he is the owner of 49% of the Russian newspaper, `Novaya Gazeta' (the other 51% being owned by the newspaper's staff). In December 2003, he was elected to the lower chamber of Russia's Parliament, the State Duma, as a Member of the `Fair Russia' (Socialist) Party. In September 2008, together with Mikhail Gorbachev, he announced plans to establish a new political party, the Independent Democratic Party of Russia, whose aims include campaigning for legal and economic reform, a stronger role for Parliament, and the expansion of Russia's independent media. Alexander Lebedev has a long history of charitable support and is the founder of the Charitable Reserve Fund, which sponsors medical and cultural projects. He has been awarded the Medal Dialogue of Cultures by UNESCO.
Evgeny Lebedev, 28, lives in London and is an entrepreneur and philanthropist with interests in the restaurant, hotel, publishing, film and fashion industries. He has been responsible for millions of pounds raised while Chairman of The Raisa Gorbachev Foundation, a charity he founded in 2006 with Mikhail Gorbachev, which raises funds for better treatment of children suffering with cancer in Russia and for research into the eradication of cancer. He has owned the Palazzo Terranova Hotel in Italy since 2006 and he and his family have other hotel interests in France, Switzerland, and the Crimea. He is in partnership with Alan Yau in the London restaurant Sake No Hana, and has invested in other restaurants in London including The Silver Room at Hush. His couture men's fashion company, Wintle, shows at the Men's Paris Fashion Week annually. He has a successful partnership with the Dazed Group, which will be launching the magazine `Dazed & Confused' in Russia later this year. Evgeny Lebedev is a History of Art graduate and his art and philanthropic activities include the Moscow Art Theatre and Chekhov Theatre in Yalta, Crimea; The Globe Theatre and The Old Vic in London. Other charities he supports include The Pushkin Prize for young writers, The Elton John Aids Foundation, The Terrence Higgins Trust, J.K. Rowling's Charity for Multiple Sclerosis, the Council of Fashion Designers of America Fashion Fund, YCTV, and The Public Memorials Appeal.
Justin Byam Shaw, 49, is a UK-based entrepreneur who has founded and sold a number of successful telecoms and media businesses. His first company, Legion Group, provided interactive voice media services in Europe, Australia and South Africa in joint ventures with newspaper newspaper companies, including Times Media Group, Fairfax and Associated Newspapers. His current businesses include Gaming Media Group, Netplay plc and Harvest Media Group. He previously worked for British Telecom on new media issues.
ENDS
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