Tuesday, September 12, 2006

Financial fund goes after Wegener

Dutch regional newspaper publisher, Wegener, is again under fire from shareholders. Was it in the beginning of the year the British company Mecom, which attempted to get the shares held by the national newspaper company De Telegraaf, now the British Governance for Owners is active, having 'constructive' talks (what an understatement!).

Wegener is a newspaper publisher which consists of a conglomerate of activities. It publishes regional newspapers and door-to-door tabloids, has printing activities, direct mail activities and an interest in a distribution company for mail. The basis of the revenues is dependent on advertisements. After the acquisition of the regional newspapers from VNU, the company is now the largest publisher with the most titles in regional newspapers, geographically covering three quarters of the Dutch market.

Governance for Owners had shares in Wegener and recently expanded its interest up to 5,12 per cent. This percentage is small compared with the interest by De Telegraaf Media Group, which possesses 23,9 per cent, and Van der Loeff with 17,2 per cent. There is also an interest by the Tweedy Brown Fund.

Wegener has never had really a clear focus. Being a regional publisher since 1903, it never has really used the revenues of regional newspapers to grow and move to other areas. The Direct mail activities were an extension of the newspaper business, but have never been a strong activity. Also the international expansion has failed over and over again as the company was not able to select the right partners and the right personnel fit for the job with regard to languages, international experience and knowledge.

The company was early in new media, when it started a videotext service for the Dutch Exchange in 1980, but in the nineties it lost its exclusivity on stock quotes. It moved into internet fast and developed a good production department, but has never been able to produce a successful service of its own. It started in 1996 with a big web 2.0 like project City Online, but this was brought down by the regional managers as they wanted more influence on the project. A car site was successfully set up, but in co-operation with a European partner.

Now Governance for Owners wants to prod Wegener. It looks like the VNU case where a small share holder started to publicly shout that the company could do much better. Eventually VNU was bought by a joint venture of two hedge funds and taken off the stock market. Whether this is going to happen with Wegener, basically depends on De Telegraaf. When TMG wants to sell the shares or part of it, some movement can be expected. So far Governance for Owners have held talks with the board of Wegener, mr Jan Wegstapel, cfo of Wegener admitted to FD, the Dutch financial daily. It must have been an interesting expedition: London city chaps travelling to Apeldoorn, a rather provincial town. I guess that they stayed in Amsterdam.

In 1995 I worked for a year in the new media research department of Wegener and predicted in an article that Wegener would be in foreign hands within 10 years with companies like the German publishers Holzbrink or Bertelsmann, or the global publisher News Corp. (which has no operational activities in the Netherlands after the sale of its radio station). I might have missed the deadline, but it is clear that Wegener will be in foreign hands for not too long.

Tags: newspapers

Blog Posting Number 506

1 comment:

hoong said...

Is there a cospiracy of the British to take down Dutch companies? Most recent Albert Hein?

I thougth hedge fund is illegal? Why allowed with VNU?