Shares in Reach PLC (LSE:RCH), the parent company of the Mirror and Express titles and hundreds of regional newspapers, slipped 2% after National World, owner of the Scotsman and Yorkshire Post, said it will not make a bid for its much larger rival despite saying it had secured the financial backing for a £350mln-plus takeover.
National World, which is listed on the London Stock Exchange with a market value of £51mln, said that it had decided not to make a formal offer after deciding that “circumstances are not aligned.”
Earlier this month it emerged that National World, which is run by the former boss of Mirror newspaper group David Montgomery, was in the early stages of exploring a possible offer for Reach.
Montgomery, who has long coveted a takeover of his former employer, had not approached the board of Reach, which is valued at £350mln.
National World said: “Following further work with its advisers, National World has concluded that while there are considerable industrial and financial advantages to combining the newspaper portfolios of the two companies the circumstances are not aligned to proceed any further with the possible offer. This is despite National World having received in principle financial support from within the investment community to fund a potential deal.”