SA media assets could be up for grabs.

This may well turn out to be a week of consequence for the South African media as this Friday, July 24, Independent News & Media, the Irish company that owns a swathe of South African newspapers, might have to announce bankruptcy.

As required by Irish insolvency law, Deloitte is on standby as the administrator in the event that the firm fails to refinance a €200-million bond by Friday and it looks unlikely that the company's founder and biggest shareholder, Anthony O'Reilly, will pull the rabbit out of the hat as he failed to do so for the first deadline a month ago.

A selling off of assets is inevitable and in South Africa the company's outdoor advertising business is already on the market, according to a Reuters report late last week. The names of media companies such as Caxton, Avusa and Media24 are being touted around as interested buyers of the Independent's local assets that include newspapers such as The Star, Cape Times, Pretoria News and The Mercury - as is the name of individuals such as Moeletsi Mbeki, the brother of Thabo Mbeki, and Western Cape businessman Barend Hendricks.

Independent Newspapers South Africa denied last week that any of the South African newspapers were for sale but the mere thought of the Irish leaving our shores has got hacks across the land shivering in anticipation and please forgive us if we take to the streets like grateful Munchkins, singing: "Ding-dong the witch is dead".

Sure, if some ­of the Independent's newspapers change hands, it will mean unsettling times and job losses. Cross-title operations such as IOL and Business Report, for instance, may not survive but it will only do the media in this country a world of good.

I have never worked for the Independent group but know enough of their dejected hacks to say: "So long, Tony, and thanks for nothing."

The Irish's tenure here has seen many fine papers become a shadow of themselves as cost-cutting has decimated news rooms' numbers and morale.

Look no further than the Independent's KwaZulu-Natal broadsheets - The Mercury, Daily News and Sunday Tribune - for the most dramatic examples of this deplorable trend. These days, frankly, the Sunday Tribune is rubbish and The Mercury and Daily News are so thin and dull that when I lived in Durban in 2004, I coughed up for a subscription from The Witness to be delivered to my door all the way from Pietermaritzburg - as I'm sure did many Durbanites. That lively little paper was bought by Media24 a few years back.

Independent hacks have told many a woeful tale in the pub over the past 15 years: The news room with only one terminal with an Internet connection. Boerewors rolls in the parking basement for the Christmas party. Waves of retrenchments. Whole divisions kept on contract with no benefits for years.

Excuse me while I hang a string of garlic around my neck to ward off the evil.

I think the government will secretly be glad to see the back of O'Reilly too as what does the former Heinz CEO and chairman care for transformation in this corner of a media empire that stretches to India, Australia and New Zealand?

For years, the story on the grapevine was that the Irish were really after the lucrative Argus group's pension fund but I suspect O'Reilly fancied the prestige of being able to hang with Nelson Mandela at swanky functions and have his newspapers cover them. And there's nothing like being able to hide behind a framed picture of you and Madiba when Denis O'Brien, O'Reilly's nemesis and the company's second biggest shareholder, blusters into your office.

Of course, being a newspaper baron isn't what it used to be and you really need substantial TV assets to buy the kind of influence that Silvio Belusconi and Rupert Murdoch wield. These days, the advertising pie is so fractured that you really need to know the business if you're a wannabe media mogul.

It is unlikely that the Independent's South African operation will be snapped up in its entirety as it will come with a hefty price tag and the Competition Commission wouldn't approve an existing South African media company buying the whole shebang.

Personally, I think it would be foolish to buy an afternoon broadsheet such as the Cape Argus or the Daily News. Afternoon papers have had their day unless you're a tabloid selling in the trains and taxis.

With Media24's aggressive expansion of the Daily Sun at the lower-income end of the market, there's really only room for one daily broadsheet in the Cape Town and Durban. And there is so much to fix at the Sunday Tribune, it's not worth the trouble or the cost.

Not only would a sell off of Independent papers be good for journalists and readers, it'll show us which of the media players know their replates from their dinner plates.

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Article Pathetic article. Sensationalist one sided opinion. Moneyweb seems to have employed a plethora of Piers Morgan wanna be's. by Ron on July 20 2009, 08:28 Find this comment inappropriate? Report it

Interesting article Good read, cheers by Jock on July 20 2009, 09:09 Find this comment inappropriate? Report it

The free market has spoken I hope that Media24 gets the go-ahead to buy them out. by JP Strauss on July 20 2009, 11:18 Find this comment inappropriate? Report it

Credit crash and Interesting times Like banks the main asset of any news medium (newspaper or electronic) is its credibility (the word has the same root as "credit"). Banks & newspapers need people to believe them and - like fairies - believe in them. (Who believes the . .more call-centre recorded "your call is important to us"?) Big Banking (e.g. ABSA: Ramos & Marcus on board; sponsoring the Roberts Mbeki hagiography) and Big Media (especially SABC) have been seduced by the ANC and long gave up their objectivity and fighting edge. Rule by committees more concerned with not rocking the boat or upsetting the ANC than responsible risk-taking. The M&G & Moneyweb, Noseweek and FM are exceptions, tho' under "Feral" Haffagee M&G objectivity lost to political correctness). One thinks of the Sunday Times under Joel Mervis - between the bums, boobs and vicars in congregants' knickers was damned good journalism. No wonder it had the largest circulation in the country. The pale (is that the right word, given its AA editorial policy?) imitation is has has become must have Mervis rotating in his grave; its circulation is falling accordingly. The internet allows one to view Bloomberg, Reuters (for free) or AFP for oneself, plus other leading news sources. This has hit traditional media world-wide which compounds the challenge of running its masters' voice media. . .less by Colin on July 20 2009, 11:28 Find this comment inappropriate? Report it

Spare a though Anybody who's watched with disbelief the Independent newspapers' failure to support their journalists' professional obligation to keep up with the times, would endorse the "witch is dead" song. That thing about a single internet connection in a . .more newsroom is real. Spare a thought for the journalists who have given long and dedicated service to the Argus, the Pretoria News, the Star et al and who, against the odds, have often given us newspapers worth reading. What's going to happen to them? . .less by Heather on July 20 2009, 11:29 Find this comment inappropriate? Report it

Spare no thought Quite so, Heather. And may I add: Spare no thought for the Independent's SA management team whch have implemented the will of the Irish with such zeal. For them I have only three words: Shame on you! by Giill Moodie on July 20 2009, 11:54 Find this comment inappropriate? Report it

Gill's a hack The entire article is one-sided, poorly researched and badly-written. What does transformation have to do with the media? by Mark on July 20 2009, 12:00 Find this comment inappropriate? Report it

Indy's Pendants Shot Gill. Ron above fails to distinguish commentary and analysis from reportage, making his comment somewhat myopic. As someone who spent 17 years reporting with what was initially Times Media Ltd (during which time O'Reilly first wined and . .more dined Madiba on some forgotten exotic island (not Robben) before buying TML's "independence' ), I can confirm the decline of at least one title, the Cape Times', autonomy. No space here to document chapter and verse but a read of Gerald Shaw's history of that paper or a chat with scores of former incumbent hacks would be of help to anyone seeking confirmation. I cut my teeth at the Natal Witness (4 years) and also seek it out as my preferred read whenever I'm in KZN. A current scan of its newsroom reveals a handful of hacks who where there when I left in '83. My wish for the Indy papers that do survive is that any rejuvenation will see an inward migration of solid journos who thrive in innovative surroundings. Keep on 'grubbing'!! . .less by Chris Bateman on July 20 2009, 12:21 Find this comment inappropriate? Report it

Independant Newspapers It is such a pity the Sunday Times is not part of this group - as one of the respondents noted above this newspaper has deteriorated to such a level that I don't think it will ever recover. These days short articles are kept as seperators between . .more political tripe "has been" or failed politicians trying to write themselves out of their pasts, there is no substance or credence to their writing and their business section is rapidly being depleted of good journalists Please Independant take over Sunday Grimes . .less by gcr on July 20 2009, 12:42 Find this comment inappropriate? Report it

Nice Insiders' View Hey Gill, Like reading a summary of what's happening at Independent from the view of a fellow hack! What's also a bit frightening is that cost cutting has been endemic at all the big newspaper groups in the country and the world. Independent is . .more an example of what happens in an extreme case. All the cost cutting and the group could still not remain profitable... Unlike Heinz's baked Beans, O'Reilly probably forgot that news, albeit important, is not a staple food but a discretionary purchase - especially now that internet makes info free. Print will have to change their business models and diversify their income streams away from ads in order to survive and refocus on their core business and that is that quality content is king, just like the reader is king. Although it's always important to run a tight ship, it is doubly true that quality comes at a cost. . .less by Roux on July 20 2009, 13:03 Find this comment inappropriate? Report it

More fool us Hi Roux. On the cost-cutting at the Independent, my understanding is that the SA operation has better profit margins than the rest of the Evil Empire and that profit margins at SA newspapers in general are higher compared to many other countries. . .more We all know that labour is a BIG cost in producing news so I surmise this means that South African hacks earn far less than their counterparts elsewhere in the world. If anyone is keen to give a more considered anaylsis of how Sa fits into the overall Independent business, here the link to their last annual report (from 2008): http://www.inmplc.com/investor-relations/ . .less by Gill Moodie on July 20 2009, 15:04 Find this comment inappropriate? Report it

Thanks Mr Bateman... ...for the kind words of support. The news rooms of SA need you and your kind back, my friend. by Gill Moodie on July 20 2009, 15:06 Find this comment inappropriate? Report it

2 words not often heard in the same sentence "media" and "asset" by charlie on July 20 2009, 15:46 Find this comment inappropriate? Report it

Great piece! Very good piece by David on July 20 2009, 16:19 Find this comment inappropriate? Report it

independent my my thank goodness hack's do not run newspapers - what a pathetic, spitful and inaccurate report by somebody who has a personal axe to grind (yes gill we both know what that is) and yes independent's margins are up there with the best in the . .more world - thank goodness. . .less by brian porter on July 20 2009, 16:19 Find this comment inappropriate? Report it

Maybe an excess of wishful thinking? Hey, heaven knows I have no reason to speak up on behalf of the Independent group and its management. But you do seem to have fallen into a hot flush of wishful thinking, simply picking up from the Mail&Grauniad's masterpiece in speculation at the . .more weekend. 1) O'Reilly is adept at pulling shamrocks out of hats; don't hold yr breath (too long) for a bankruptcy declaration. 2) Indy Seffrica is a stand-alone biz; if momma/pappa company goes belly-up, doesn't mean Seffrica has to fall apart. 3) Why in any case would Independent News & Medi-aaah sell one of its best assets? It makes no sense; it's the lousy ones you sell. Duh. 4) Why should BR not survive? It's one of the components that makes boodle. 5) Sun Trib is no worse than anything else on offer; you're just being a meanie. 6) Cost-cutting, etc, which is what managers do in tough times, has decimated ALL news rooms & newspaper quality in the WHOLE country - and if you think the managers of other companies in SA or anywhere in the world are good fairies, well, you just don't get out enough. Love to granny & lots of love to you... . .less by jeremy gordin on July 20 2009, 16:42 Find this comment inappropriate? Report it

Axe Worthy You lost me on the "personal" axe there, Brian. As I said in the column above, I've never worked for the Independent. Nevertheless, I'm not above grinding or gossiping. I would be a sorry hack if I was and what fun that this a column and . .more not a news report so my opinion is indeed axe-worthy. Curiously, many hacks do in fact run newspapers (even at the Independent -- Nazeem Howa springs to mind) so I guess they must know a thing or two about profit margins. . .less by Gill Moodie on July 20 2009, 16:43 Find this comment inappropriate? Report it

Competition - what competition? Any business that can get away with a massive increase in selling price (26% Bus Day this year) (56% Sunday Times last year) - without a public murmur or comment from themselves justifying the increase must be doing well and have no competition - . .more so where is the pain with threats of closure? Oh and what is the Competition Commission doing about that? When you own the media, you can get away with murder - just point everyone in another direction - e.g. "naughty milk producers and steel producers etc.) . .less by Civil (as in polite) Servant on July 20 2009, 17:37 Find this comment inappropriate? Report it

O'Reilly killed the media star Apparently the SA operation earns Tony a tasty 70 million Euros profit annually (700 million rand ! ) - so he is basically milking his monopoly, knowing that he has very little competition so why bother with annoying expenses like paying for proper . .more journalists. I have noticed recently that you tend to read in his papers what one reads in moneyweb 24 hours earlier. Of course, what would be worse than the present dire situation is if the usual ANC BEE billionaire suspects start sniffing around wanting to get their hands on the media. . .less by Sad days on July 20 2009, 18:01 Find this comment inappropriate? Report it

Advertorial Was it not The Star which first introduced the term advertorial to South Africa? by Ambrose Bierce on July 20 2009, 18:18 Find this comment inappropriate? Report it

Got it in one Brilliant, Gill. You got it in one! To Ron and Brian Porter I say: You either have no clue about what is really going on at Independent or you are part of the upper management group that is warm and cosy in Tony's fold. And Jeremy (Gordin). . .more Shame on you - lying is something to be avoided, not aspired to. All these years working for Independent must have skewed your perception of reality. A former colleague of mine (who used to work at Independent) summed up the feeling of staff when he said: "You can't be incompetent to mess things up like this. It takes a special kind of evil bastard to really F***** up a company like they have done to Independent." But then again, as Indy staff have been told many, many times by managment (right before each retrenchment- and cost-cutting spree) : "Relax, you're being paranoid. The company is doing well and is in good hands. Of course we'd tell you if something was that seriously wrong." Must be my overactive imagination and crazy opinions acting up again. . .less by Another Independent Media hack on July 21 2009, 07:06 Find this comment inappropriate? Report it

The Biz On the business end of the Indy Empire, Jeremy has a point that the SA operation is a good earner with excellent margins. It brought in 69.1m euros operating profit after exceptionals for the year ending Dec 31 2008. The UK operations was . .more an absolute dog and Australasia and Ireland brought in some bucks but their margins look quite low. Bearing in mind that I'm no financial journalist, my question is what kind of multinational is this that it's South African operation is one of the best performers? Surely this in itself tells us the company is is in big trouble? Anton Harber pointed out yesterday on his blog that they have been putting off some massic cap ex in SA (in the form of the aging Sauer Street press and its building). I think if an attractive offer or two came along, the Irish will consider it very carefully and who knows what Denis O'Brien hopes to achieve out of this? . .less by Gill Moodie on July 21 2009, 09:49 Find this comment inappropriate? Report it

Yikes! Oh boy...if anyone takes your opinion on this matter seriously after this comment...one doesn't have to be a financial journalist to understand this either. "...what kind of multinational is this that it's South African operation is one . .more of the best performers? Surely this in itself tells us the company is is in big trouble?" . .less by Shaking Head on July 21 2009, 16:09 Find this comment inappropriate? Report it

You see... One doesn't need to read Gill's well-written article to realise what's happened at Independent. All I can say is thank god I never worked for them. by Jan on July 27 2009, 11:32 Find this comment inappropriate? Report it

Good article Well done Gill. I'm glad that you wrote this piece. by Herman Lategan on July 30 2009, 10:09 Find this comment inappropriate? Report it

Independent True story: Call Cape Times newsroom (remember it's a morning paper) to tip them off about Gwede Mantashe shutting down Eric Meyeni one night as he was discussing the SABC board on air...a lively debate...Here's the response; "But it's 8 O' Clock." . .more from the person who answered the phone. "Aren't you a morning paper? We used to work until midnight". "No, we're all packing up to go home"... "But it's an important story...the ANC is trying to tell the public broadcaster what it can and can't talk about it's a story!"... Laconic reply "Dont they do it all the time?" A call to Die Burger nagkantoor resulted in an immediate understanding of the implications of the story, a call back from an interested and informed journalist and then an actual story the next day. The above sums up one of the problems with the Independent group. I know there are many good journos who work there but there are also too many like the clot who answered the phone..... . .less by Marianne Thamm on July 30 2009, 10:23 Find this comment inappropriate? Report it

hmm Well written Gill... I enjoyed the tone of your article; lets see how it pans out to see who has the last word by Teresa on August 07 2009, 15:12 Find this comment inappropriate? Report it

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