THE OWNER of the Guardian newspaper is in talks over a sale of its stake in the parent company of Auto Trader, in a bid to prop up its lossmaking papers.
Guardian Media Group (GMG) could sell its 50 per cent share in Trader Media Group (TMG) to TMG’s joint owner, the private equity firm Apax Partners, for around £600m, sources confirmed yesterday. TMG owns the successful Auto Trader magazine and listing service, as well as other marketing products for car dealers, and paid out a £100m special dividend last year.
The business continues to do well, in stark contrast to Guardian News & Media, the publisher of the Guardian and Sunday paper the Observer, which saw a £44.2m operating loss in the last financial year.
GMG has just one shareholder, The Scott Trust, and although it will see the Guardian and Observer’s widening losses as a concern, it is not run for profit. It is understood that the company is not in any rush to sell TMG, with it sitting on more than £300m in cash. One source close to the group admitted that TMG will be sold at some point, but put the chances of the current talks ending successfully at 50/50.
GMG has sold other assets in a bid to plug the gaps in the Guardian’s finances, disposing of its radio business, which runs the Smooth and Real stations, to Global Radio for around £70m earlier this year.
GMG did not comment yesterday.