Key report on INM’s Celtic Media deal sent to Minister

Minister for Communications Denis Naughten has received a key report on his review of the proposed takeover of regional newspaper group Celtic Media by Independent News & Media (INM).

The Broadcasting Authority of Ireland (BAI), which was charged in January with conducting a full media merger examination of INM’s deal to buy Celtic Media, sent its report to the Minister on May 9th, one day ahead of its deadline to do so.

The report includes the BAI’s recommendations on whether the deal should proceed or not, although the ultimate ruling rests with the Minister.

Mr Naughten has 20 working days from the receipt of the report to consider the matter. A decision is now expected on or before June 8th.

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The involvement of the broadcasting regulator in a proposed deal between two newspaper groups was triggered under cross-media ownership regulations because INM's biggest shareholder is Denis O'Brien, who owns the radio group Communicorp.

Although the Competition and Consumer Protection Commission ruled in November that the deal would not lead to a substantial lessening of competition in any market for goods, the Minister called for a full review on media plurality grounds.

Public consultation

The BAI’s report takes into account submissions to a public consultation on the proposed deal, while it also includes the conclusions of an advisory panel appointed by the Minister. A third contribution to the report comes from Communications Chambers, a UK-based media and telecoms consulting firm hired by the BAI.

Celtic Media publishes the Westmeath Independent, Westmeath Examiner, Anglo Celt, Meath Chronicle and Connaught Telegraph, as well as two free titles, the Offaly Independent and Forum.

Revenue at Celtic Media arrived at €11.3 million in 2015, the latest year for which company accounts have been published, while the group pretax profit was €214,152 in that year.

In the 18-month period to the end of 2014, its revenue was €15.6 million and its pretax profit was €838,420.

Celtic Media chief executive Frank Mulrennan, who is the company's largest shareholder, told an Oireachtas committee in February that the business model for local newspapers was "broken" and the future of its seven titles would be best protected by being part of a larger company.

INM first approached the company about a possible acquisition in April 2016.

The proposed purchase is the first to be subject to a full review under media merger legislation introduced as part of the Competition and Consumer Protection Act 2014.

This article was updated to remove comparisons between Celtic Media’s revenue and profits in the 12 months of 2015 with those of the previous accounting period, which was 18 months long.