CMA clears printing JV between News UK and DMG Media

The Competition and Markets Authority (CMA) has cleared the proposed joint venture between DMG Media and News Corp UK & Ireland Limited in respect of their newspaper printing activities in Britain.

The regulator, which launched its probe early last month, on Thursday said the merger “does not give rise to a realistic prospect of a substantial lessening of competition as a result of horizontal unilateral effects.”

News UK and DMG Media – two of the UK’s biggest newspaper publishers – have in October last year proposed the joint venture which would combine the printing operations of Newsprinters (News UK) and DMG Media printing sites in Thurrock and Dinnington.

Following the CMA decision, the companies said a new company will now be created to run the combined print and primary distribution operations, adding that the joint venture will help improve the efficiency of their print operations and establish a sustainable business model for the future of national newspaper printing in the UK.

The combined plants are expected to print more than three million newspapers a night and almost 22 million a week.

The joint venture will operate independently, with its own senior leadership team drawn from Newsprinters and DMG Media. Darren Barker, currently managing director of Newsprinters, will become chief executive, while Julia Palmer-Poucher, currently group production director at DMG, will become chief operating officer. The new company is expected to go live in early June.

The companies added that the joint venture is limited to the their printing operations and does not represent closer working between News UK and DMG Media on media, editorial or commercial activity.

It will retain the three current Newsprinters sites in Broxbourne (Hertfordshire), Knowsley (Merseyside) and Eurocentral (Glasgow), while closing DMG Media sites in Thurrock (Essex) and Dinnington (Sheffield).

DMG Media will retain sole ownership of the Carn print site in Northern Ireland which is unaffected by the joint venture.

“It has been our long-term view that consolidating print operations is vital to retaining a national network of print and distribution logistics and, crucially, supporting the unique plural media landscape in the UK,” David Dinsmore, News UK EVP and chief operating officer, said.

“I’m delighted that the CMA has cleared the combination of our printing operations. This decision means that readers of all newspapers can expect to enjoy them for many years to come. I have no doubt that the new company created by this joint venture - led by Darren Barker - will provide best-in-class service to all the news brands it serves.”

James Welsh, deputy chief executive, DMG Media, said: “Today’s announcement from the CMA is an important milestone for our industry. The combination will ensure that our readers, and those of other newspapers, can enjoy the paper they love for many years to come. It has been an uncertain time for our production teams and I would like to thank them for their continued dedication and professionalism.”

Cautious welcome

Independent news retailers have given a ‘cautious’ thumbs up to the merger.

“Newspapers are extremely important to Fed members, which is why we adopted our Pro Print strategy and why we welcome any developments that ensures the sustainability of the printed word,” Muntazir Dipoti, the Fed’s national president, said.

“This joint venture will do just that, as well as ensuring the continuation of a national network. We, therefore, welcome the CMA’s decision. However, as the two publishers involved produce some of the UK’s biggest selling newspaper titles, we will be monitoring developments carefully to ensure there is no detrimental impact to our members’ businesses.”

Dipoti added that between now and June, News UK and DMG Media must work with supply chain stakeholders on five key areas:

• Revisiting and resetting publisher cut off times into wholesaler depots and, in turn, making the National Distribution Monitor fit for purpose.
• Understanding current delivery shortcomings and the impact at retail, particularly when bunching at wholesale results in late deliveries.
• Ensuring that arrival times into retail satisfy their customers’ needs.
• Ensure home news delivery providers are clearly identified and this guaranteed sale is prioritised.
• Review and share their contingencies.

Newsprinters currently prints for a number of national and regional clients, including News UK, DMG Media, Telegraph Media Group, Financial Times, Newsquest, Sport, Evening Standard, John Lewis Partnership, Post Publications, Newtrade and Clearsky, as well as providing distribution for the Guardian.

DMG Media brands include Daily Mail, Metro, i and New Scientist.