Way out of the quasi stalemate
Publishers There is much to suggest that 20 Minuten will soon become wholly owned by Tamedia - rumors to that effect, but also plausible reasons.
Publishers There is much to suggest that 20 Minuten will soon become wholly owned by Tamedia - rumors to that effect, but also plausible reasons.
In recent weeks, there have been increasing indications that Tamedia and the Norwegian media group Schibsted are negotiating an early completion of their commuter newspaper deal concluded 20 months ago. According to well-informed circles, the temporary joint venture partners are engaged in a financial poker game, at the end of which a purchase price of "around CHF 120 million" is likely to be paid for the 50.5 percent of 20 Minuten (Schweiz) AG that is still controlled by Schibsted via 20 Min Holding. As might be expected, the two listed parties deny any such talks. Martino Bammater, Chairman of the Board of the object of desire, also "cannot confirm the speculation." As a reminder: On March 21, 2003, Tamedia took over 49.5 percent of the commuter paper via its subsidiary Express Zeitung AG in a first step, at that time for an estimated CHF 15 million (excluding the CHF 11 million "Express" maneuver). According to the contract, the remaining shares also went to Tamedia - 20.25 percent at the end of 2005 and 20.25 percent at the end of 2006. How much was made dependent on the company's success in the year in question? When the contract was signed, experts estimated the total volume of the transaction at around 70 million; today, 20 Minuten appears to be worth twice as much (see interview on the right).
St. Gallen as deadline
This quantum leap - which was certainly unexpected by both the previous and future owner - is due to 20 Minuten's performance in the reader and advertising market. Based on the available data, Scott Weldon, media specialist at the private bank Lombard Odier, estimates that the free title, which according to Tamedia's in-house magazine Doppelpunkt has also risen internally "from underdog to top performer", could already generate a double-digit million profit in 2004 with sales of around CHF 50 million thanks to comparatively low fixed costs, and the trend is still rising. The longer Tamedia waits, the more expensive the supposed junior partner of the Tages-Anzeiger will become.
Another argument in favor of the early takeover is the fact that Schibsted will retain control of the seven-member Board of Directors until the end of the contract, regardless of the ownership structure, but as a seller is unlikely to be interested in longer-term investments. However, such an investment is on the cards with the expansion to St. Gallen announced for next spring. "This project would be a plausible deadline for negotiations," says Weldon. In addition, the stock market generally reacts negatively to uncertainty, "especially for products with such growth potential", the analyst told Werbewoche.
Moreover, Tamedia already has two capital-intensive uncertainties with the regionalization and the relaunch of its (soon probably only journalistic) flagship next year. All the more reason to get the deal with the Norwegians over the line in good time. This also makes sense to the Chairman of the Board of Directors of 20 Minuten Switzerland quoted above.
But Bammater is adamant: "We have no reason to deviate from the original schedule." That's easy to believe, because "we" here of course stands for Schibsted, whose Zurich trustee he ultimately is. In addition, Bammater is presumably one of the people who benefit from the 2 percent of 20 Min Holding that Schibsted has reserved for top management. No wonder, then, that he would only consider an early total withdrawal of the Norwegians from Switzerland "if the price is sensationally high". The ball is therefore in the court of his Board Vice Chairman, Tamedia CEO Martin Kall.
Tagi in the shadow: 20 Minuten is on course to become Tamedia's financial flagship.
Oliver Classen
In recent weeks, there have been increasing indications that Tamedia and the Norwegian media group Schibsted are negotiating an early completion of their commuter newspaper deal concluded 20 months ago. According to well-informed circles, the temporary joint venture partners are engaged in a financial poker game, at the end of which a purchase price of "around CHF 120 million" is likely to be paid for the 50.5 percent of 20 Minuten (Schweiz) AG that is still controlled by Schibsted via 20 Min Holding. As might be expected, the two listed parties deny any such talks. Martino Bammater, Chairman of the Board of the object of desire, also "cannot confirm the speculation." As a reminder: On March 21, 2003, Tamedia took over 49.5 percent of the commuter paper via its subsidiary Express Zeitung AG in a first step, at that time for an estimated CHF 15 million (excluding the CHF 11 million "Express" maneuver). According to the contract, the remaining shares also went to Tamedia - 20.25 percent at the end of 2005 and 20.25 percent at the end of 2006. How much was made dependent on the company's success in the year in question? When the contract was signed, experts estimated the total volume of the transaction at around 70 million; today, 20 Minuten appears to be worth twice as much (see interview on the right).
St. Gallen as deadline
This quantum leap - which was certainly unexpected by both the previous and future owner - is due to 20 Minuten's performance in the reader and advertising market. Based on the available data, Scott Weldon, media specialist at the private bank Lombard Odier, estimates that the free title, which according to Tamedia's in-house magazine Doppelpunkt has also risen internally "from underdog to top performer", could already generate a double-digit million profit in 2004 with sales of around CHF 50 million thanks to comparatively low fixed costs, and the trend is still rising. The longer Tamedia waits, the more expensive the supposed junior partner of the Tages-Anzeiger will become.
Another argument in favor of the early takeover is the fact that Schibsted will retain control of the seven-member Board of Directors until the end of the contract, regardless of the ownership structure, but as a seller is unlikely to be interested in longer-term investments. However, such an investment is on the cards with the expansion to St. Gallen announced for next spring. "This project would be a plausible deadline for negotiations," says Weldon. In addition, the stock market generally reacts negatively to uncertainty, "especially for products with such growth potential", the analyst told Werbewoche.
Moreover, Tamedia already has two capital-intensive uncertainties with the regionalization and the relaunch of its (soon probably only journalistic) flagship next year. All the more reason to get the deal with the Norwegians over the line in good time. This also makes sense to the Chairman of the Board of Directors of 20 Minuten Switzerland quoted above.
But Bammater is adamant: "We have no reason to deviate from the original schedule." That's easy to believe, because "we" here of course stands for Schibsted, whose Zurich trustee he ultimately is. In addition, Bammater is presumably one of the people who benefit from the 2 percent of 20 Min Holding that Schibsted has reserved for top management. No wonder, then, that he would only consider an early total withdrawal of the Norwegians from Switzerland "if the price is sensationally high". The ball is therefore in the court of his Board Vice Chairman, Tamedia CEO Martin Kall.
Tagi in the shadow: 20 Minuten is on course to become Tamedia's financial flagship.
Oliver Classen
