The Evening Standard on Wednesday said Russian tycoon Alexander Lebedev has bought a controlling 75.1 per cent stake in the venerable but money-losing paper for a "nominal sum" widely reported to be $1.40.
After weeks of rumours, Standard owner Daily Mail & General Trust PLC confirmed that a company formed by Lebedev and his 28-year-old son, Evgeny, would acquire 75.1 per cent of London's afternoon newspaper. The elder Lebedev is set to become the chairman of the newspaper's board. Daily Mail & General Trust will retain a 24.9 per cent stake.
Some details about the deal from the Washington Post: [Link]
"We are strong supporters of a free and independent press and we greatly admire the Evening Standard as an iconic publication with its pedigree of fine journalism and commentary," Alexander Lebedev said in a statement.
In the 1980s, Lebedev worked for the KGB at the Soviet Embassy in London. He made his fortune in banking and insurance and has stakes in Russia's national airline, Aeroflot; the state-owned energy firm Gazprom; and other companies. Along with former Soviet president Mikhail Gorbachev, Lebedev also owns Novaya Gazeta, a pro-democracy Russian newspaper.
ad_iconOn Wednesday, the Evening Standard said Lebedev fell "in love" with the paper when he was working as a spy at the embassy in London, where he studied British newspapers.
Under the terms of the deal, Lebedev will take a 75.1 percent controlling stake in the daily while Associated Newspapers Ltd., a subsidiary of the Daily Mail and General Trust, will retain a 24.9 minority holding. The 181-year-old Evening Standard "will establish a new editorial committee that will safeguard the principle of editorial independence," the paper's statement added.
Other newspapers reacted cautiously, but not pessimistically, with some citing Lebedev's history of journalistic independence in Russia and others noting that no one else was willing to buy the beleaguered Evening Standard. The Observer's headline: "An oligarch we could learn to love."
Although there are no official numbers, analysts estimate that the Evening Standard loses at least 10 million pounds, or $13.9 million, a year. On Wednesday, the paper said only that it incurs "very considerable financial losses." It has been hurt by the rise of giveaway papers, known as freesheets, whose distributors often stand just a few paces from the Evening Standard's iconic blue booths.
The sale has triggered panic on Fleet Street about the future of other newspapers in Britain, where 10 national papers still slug it out on the newsstands every day (unlike in the United States, very few papers are sold through subscription). And as in other countries, newspaper revenue has plunged as advertising has dried up.
