The highest bid was not enough to persuade the Lagardère and Le Monde groups to sell their regional newspapers to Mecom.
Lagardère Group announced on Monday that it had sold its regional dailies in Southern France to Groupe Hersant Média for €160m. Le Monde Group is suspected to follow suit and sell les Journaux du Midi for €100m, reports Observatoiredesmedias.
Mecom had offered €300m for Le Monde and Lagardère's regional newspapers, but said at an early stage they expected the bid to be rejected.
"Rather than to use a part of the 40 additional millions to convince the employees to accept Mecom's offer, Lagardère chose the easiest way by yielding her titles to Groupe Hersant Média, the least alarming candidate, but also least prepared... This transaction confirms the original financial strategy of French media, which often prefer to be seen like extensions of family empires rather than centres of profit," writes Nicolas Kayser-Bril over at Observatoiredesmedias.
In his opinion, these newspapers need a serious revival plan to turn around meager financial results.
According to a press release, The Lagardère Group’s regional daily press arm in southern France generated revenues of €222m and recurring operating income of €3m in the year ended December 31, 2006.
'With the sale of La Provence, Nice Matin, Var Matin, Corse Matin and free daily Marseille Plus, Lagardère pulls out of newspapers alltogether. Threats of strikes at Nice Matin were meant to prevent the sale to Mecom,' reports Piet Bakker.
The blog buzz, like here, here and here, around the sales negotiations suggests there was massive oppostion to Mecom's bid, in part based on fear that David Montgomery's British Investment vechicle was only looking for short-term profit.