Trinity Mirror has proposed the full acquisition of the 80 per cent shareholding in Local World which it does not already own for £154.4m, putting an equity value on the full business of £193m.
On top of this Trinity Mirror has also agreed to shoulder a £27m debt burden from the business in addition to £6m in transaction costs.
When the dust settles the transaction will make Trinity Mirror the UK’s largest regional news publisher with a portfolio of websites drawing 120m monthly unique browsers and 790m monthly page views.
It is expected that this will deliver economies of scale to the combined business of between £10 and £12m in the second full year of ownership.
Simon Fox, chief executive of Trinity Mirror, said: “Local World is a business we know and respect and by combining it with Trinity Mirror we will create an organisation of scale, with the talent and financial capacity to invest and adapt to the rapidly changing media landscape. It is a vote of confidence in local press and its future.”
David Montgomery, group CEO, Local World, added: “Local World was founded three years ago with a clear vision to reinvigorate regional media with an unrelenting focus on our content, audience and advertisers. I am proud of what we have achieved. Local World is full of energy and talent and Trinity Mirror is acquiring a vibrant business with a strong future. I want to take this opportunity to thank everyone who has made Local World the success it is today.”
Local World recorded an operating profit of £39m on the back of £221m in revenues in 2014.