Caxton threatens to take Media24 to the Competition Commission
Printing and publishing group Caxton plans to take Media24 to the Competition Commission over "serious competition and public interest concerns" following the announcement of a major restructuring that could cost 400 jobs.Earlier this week, Media24 announced it had accepted an offer to sell its distribution business, On the Dot, as well as its community newspaper portfolio, to Novus Holdings. The deal needs approval from the Competition Commission.
The media group is also considering closing the print editions of five newspapers, including Rapport and City Press, due to a "devastating decline" in circulation and advertising. The group plans to go "fully digital," which would strengthen its two main digital news brands, News24 and Netwerk24.
'Devastating'
However, Caxton chairperson Paul Jenkins said on Friday that Media24 had "ignored alternatives to this destructive path," such as selling viable daily and Sunday titles.
"Caxton believes that these steps give rise to serious competition and public interest concerns that will have to be considered by the Competition Commission," he said. "Caxton is also concerned that the merger transaction is being prematurely implemented."
Jenkins said Media24's decision to close titles and sell its community newspapers and distribution arm to Novus would have "devastating effects on print media in South Africa."
Media24 CEO Ishmet Davidson said on Friday that the media group had been in discussions with Caxton as a potential buyer for On the Dot and the community newspaper portfolio.
In the end, he said, the group decided to go with Novus, which already prints most of its newspapers.
"Media24 has a good business relationship with Caxton as the printer of our magazine portfolio," he said. "There is no point arguing the details or the background and facts that underpin the transaction, subject to regulatory approval, in the media."
Davidson said that Media24 remained "fully committed" to the business rationale for the proposed restructure, and would be "happy to defend our actions in a formally structured legal process".
Earlier in the week, the Media24 CEO announced that changing consumer preferences meant Media24 could no longer keep some of its most iconic printed newspapers "on life support".
"We've simply run out of options," he added. "People now read more news than ever, but most prefer to do so on their cell phones or laptops, and publishers have to comply with their preferences."
Rapport, City Press, and Daily Sun would continue as "digital-only brands". Die Burger and Son in the Western Cape would not be impacted by the changes.
-NEWS24