Swedish newspaper publisher Metro International has agreed to sell its three U.S. papers to Seabay Media, a company founded by Pelle Törnberg, Metro’s former CEO.
Metro publishes three daily U.S. editions of its free paper, in New York, Philadelphia and Boston. The U.S. papers have a combined circulation of 590,000 daily and reach around 1.2 million readers, which Metro said is “the biggest advertising market in the world.”
Metro’s president and CEO, Per Mikael Jensen, admitted that the U.S. operations had suffered losses, but added, “After a rough 2007, we have seen many improvements in Metro USA and losses have decreased significantly
The full release is after the jump.
SEABAY MEDIA HOLDINGS AND METRO INTERNATIONAL SIGN SALE AND PURCHASE AGREEMENT TO ACQUIRE METRO’S USA OPERATIONS
LUXEMBURG – May 11, 2009, Metro International S.A. (“Metro International”), the international newspaper group, and Seabay Media Holdings LLC (“Seabay Media”), a company formed and controlled by Pelle Törnberg, the former CEO of Metro International today announced that they have signed a binding Heads of Terms whereby Seabay Media will acquire Metro International’s operations in the United States (“Metro USA”). Financial terms were not disclosed. The transaction is expected to be completed by June 1st 2009.
Metro USA publishes the free daily newspaper Metro in New York and Philadelphia. Metro is also published in Boston through a partnership with the Boston Globe. The three newspapers have a combined circulation of 590.000 daily copies and approximately 1.2 Million readers in the US, which is the biggest advertising market in the World.
Under the terms of the agreement, Seabay Media will continue to publish Metro in all three markets under a service and license agreement with Metro International. The newspapers will also remain in Metro International’s global advertising packages.
Pelle Törnberg, founder and CEO of Seabay Media commented: “We are excited and look forward to continuing the business after completion and to further develop Metro in the United States. In the current economic situation advertisers are looking to brands like Metro that represents a strong offering through better value and reach. At the same time we recognize the challenges ahead but we will give Metro our full attention and we look forward to starting the hard, daily work with the staff of the newspapers necessary to ensure Metro’s success.”
Per Mikael Jensen, President and CEO of Metro International commented: “Metro USA will continue as a licensed operation to Metro International under strong leadership from one of the experts in the business. After a rough 2007, we have seen many improvements in Metro USA and losses have decreased significantly. I’m confident that Metro USA will reach profitability and steady growth.”
The book effect of the proposed transaction is estimated to be around -2 Million USD. Closing is subject to completion of definitive agreements and customary pre-closing conditions.