Britain's Minister for Competition, Mr Gerry Sutcliffe, has sanctioned the sale of two London titles by Independent News & Media.The titles are part of a stable of titles that the Independent is selling in the UK. Colm Keena and Una McCaffrey report.

The British government delayed the sale of the two titles to Newsquest, a subsidiary of US company Gannett, because of competition concerns.

However, Mr Sutcliffe has decided that the transfer of the titles to Newsquest can proceed. His decision follows consultation by the Department of Trade and Industry with the parties and interested third parties.

The consultation included consideration of the viability of the titles if separated from the Islington Gazette, the third title in the Independent group's north London division.

Mr Sutcliffe decided that the titles would be likely to close if the sale was blocked. The British government was concerned about the concentration of ownership in the Newsquest group.

Earlier this year, Independent announced that it had agreed to sell 23 titles to Newsquest for €86 million as part of a plan to reduce its debt levels. The transfer of eight of the titles was blocked last month.

Meanwhile, Independent has been given a "buy" rating from Merrion Stockbrokers, with analyst Ms Niamh Brodie seeing potential for a re-rating in the stock over the coming months.

Ms Brodie points to two positive drivers within the group's operations in the northern hemisphere: the successful introduction of a tabloid version of the UK Independent and a strengthening in the advertising market in the Republic.

The sustenance of either trend could, according to the analyst, add up to 7 per cent to group earnings per share in 2004.

Ms Brodie recommends buying Independent at €1.86. The stock closed at €1.88 last night.