One Canada Square
London E14 5AP
Telephone: 44 20 7293 3000
Fax: 44 20 7293 3476
Sales: £1.13 billion (2001)
Stock Exchanges: London
Ticker Symbol: TNI
NAIC: 511110 Newspaper Publishers
We have delivered a robust financial performance in 2001. The current economy makes forecasting future performance very difficult but we have developed clear and ambitious plans for all parts of the Group. We have the team and the determination to deliver these plans. In doing so, we expect to create value for shareholders and fulfillment for all of our people.
1737: The News Letter, published by Trinity and the oldest surviving English-language newspaper in the world, makes its first appearance in Belfast.
1855: The Daily Post, with a cover price of one penny, is launched by Liverpool Daily Post & Echo Ltd.
1870: Trinity introduces the Belfast Telegraph, which becomes Northern Ireland's best-selling newspaper.
1894: Alfred Harmsworth buys the London Evening News for £25,000.
1896: Alfred and Harold Harmsworth found the Daily Mail.
1911: The Daily Mirror becomes the first daily paper with a circulation greater than one million.
1951: Cecil Harmsworth King becomes chairman of the Mirror.
1961: The Mirror and its newly acquired magazine empire are merged to form the International Publishing Corporation (IPC).
1968: Cecil King is forced to resign.
1970: The merger of IPC and Albert E. Reed & Co. Ltd., one of the largest paper products companies in Europe, creates Reed International.
1984: Robert Maxwell purchases the Mirror papers for about £90 million, and the Mirror Group Newspapers Ltd. (MGN) becomes a pillar of his business empire.
1985: Trinity International Holdings plc is established as a new parent company for Liverpool Daily Post & Echo Ltd.
1988: Trinity International Holdings shortens its name to Trinity plc.
1991: Robert Maxwell is found dead, presumably from drowning.
1994: A consortium led by the Mirror Group purchases the Independent for an estimated $110 million.
1995: Trinity buys five British newspapers, including the Belfast Telegraph in Northern Ireland and the Western Mail in Cardiff, Wales, from Canada's Thomson Corporation.
1997: Mirror Group acquires Midland Independent Newspaper plc.
1998: Mirror Group sells its stake in the Independent.
1999: Trinity announces its purchase of Mirror Group and the combined company is named Trinity Mirror plc.
2002: Trinity Mirror announces plans to earmark an additional £25 million for editorial revamping and marketing for the Daily Mirror.
Trinity Mirror plc is the largest newspaper publisher in the United Kingdom, with more than 250 regional and national newspaper titles. The result of a 1999 merger of the regional newspaper publisher Trinity plc and the primarily national newspaper publisher Mirror Group plc, Trinity Mirror reaped the benefits of the newspaper consolidation of the 1980s and 1990s. With three of the top ten regional evening newspapers and three of the top six regional Sunday papers, Trinity Mirror led the nation in 2002 in regional newspaper readership. In addition, for much of the 20th century, the company's Daily Mirror had been one of the world's most popular newspapers, a pioneer of what has been characterized variously as New Journalism, the popular press, or, less charitably, the scandal sheet. As Europe's fourth largest selling newspaper, the Mirror continued to anchor Trinity Mirror's national holdings, along with Sunday People and the Daily Record. As of 2002, Trinity Mirror also owned more than 50 trade magazines, ran an equal number of web sites, and published several popular sporting newspapers.
Although the company officially incorporated in 1999, the history of some of its titles can be traced back hundreds of years. In addition to holding some of the oldest, continuously published English-language newspapers, the two merging companies had made significant contributions to the development of newspaper publishing. To fully appreciate the rich history of Trinity Mirror, one must look to the history of its two progenitors, Mirror Group plc and Trinity plc.
Trinity's 19th-Century Beginnings
When Trinity merged with Mirror Group in 1999, it already boasted a long history. It published the News Letter in Belfast, which first hit the streets in 1737, making it the oldest surviving English-language newspaper in the world. Trinity also published the Belfast Telegraph: Launched in 1870, it became Northern Ireland's best-selling newspaper. In addition, Trinity published the South Wales Echo, first issued in 1884, and the Coventry Evening Telegraph, first printed in 1891. Although Trinity had acquired these and other long-running papers rather late in its history, the company's direct precursor, the Liverpool Post & Echo, had a history equally distinguished.
In the mid-1800s the owner of the weekly newspaper the Liverpool Journal, Michael James Whitty, approached a Select Committee of MPs with a proposal. At the time, a Stamp Act was in place that taxed newspapers, an arrangement that Whitty claimed restricted enterprise. If the act were repealed, he promised, he would publish a daily paper to be sold for just one penny. On June 11, 1855, Whitty launched the Daily Post. True to his word, the eight-page paper had a cover price of one penny.
The paper was a success, and 14 years later Edward Russell was appointed the editor of the Daily Post. He ran the paper for nearly a half-century and oversaw several important events.
In 1879 the Daily Post's sister paper, the Liverpool Echo, was launched. Alexander Jeans, the former manager of the Daily Post, founded the paper, and it was produced in the same facility as the Daily Post. The Liverpool Echo had ten editions a day and sold for a mere halfpenny. It managed to continue at that price for almost 40 years; in 1917 the price rose to a whole penny.
Both the Daily Post and the Liverpool Echo were known for their Liberal editorial slant, despite their location in a predominantly Tory city. Russell, editor of the Daily Post, supported Gladstone, campaigned for Irish Home Rule, and generally advocated Liberal positions on issues through the paper.
In 1905, Liverpool's Licensing Magistrates brought a case of criminal libel against Russell and the paper. Decided in favor of Russell, the case was considered an important success for freedom of the press.
In another step on its road to becoming a newspaper empire, the Daily Post merged with its competitor the Liverpool Mercury in 1904. A public company was established, with Alexander Jeans as its managing director. Jeans ran the company until his son Alan succeeded him. Alan Jeans increased the company's publishing concerns, over the years purchasing additional newspaper titles in the area. He died in 1961, and management of the company passed to another Jeans, this time Alan's son Alick.
Alick Jeans continued his father's policies of expansion. By the time of his death in 1972, Liverpool Daily Post & Echo Ltd. had become a diversified international company. Along with the Daily Post and the Liverpool Echo, the company published numerous regional weeklies in Britain and North America. In addition, the company manufactured cardboard and paper products for the printing and packaging industries.
Liverpool Daily Post & Echo was affected in the 1980s by the city's rapidly shrinking population and rampant unemployment. The company relaunched both papers as tabloids and managed to hold its readership to a steady level.
Trinity Expansion in the 1980s and 1990s
In 1985, the company restructured itself to better support its various businesses. A new parent company was established, Trinity International Holdings plc. Liverpool Daily Post & Echo Ltd. was reorganized as a subsidiary, primarily responsible for publishing the Post and the Echo. Other subsidiaries ran the British weeklies, the North American newspapers, and the paper manufacturing and answered directly to Trinity International. Three years later, the company shortened its name to Trinity plc.
Regional newspapers suffered in the late 1980s and early 1990s from falling subscriptions and rising newsprint costs. Their ad revenues were generally falling, and they had trouble attracting a younger audience. As a result, most of the largest publishers were dumping their regional titles. Trinity, however, saw an opportunity to rise from its position as the 14th largest regional press in Britain.
In 1988, Trinity purchased the North Wales weeklies series. Then, in 1990, the company's American division bought Pittsburgh Pennysaver for $13.5 million. The acquisition was expected to raise the revenues of Trinity's U.S. newspaper group to $40 million annually. With additional small purchases, Trinity was soon in the ranks of the five largest regional newspaper publishers in Britain.
Trinity took the lead in 1995 when it bought five British newspapers from the Thomson Corporation of Canada. The $522.4 million purchase included the Belfast Telegraph in Northern Ireland and the Western Mail in Cardiff, Wales. The acquisitions brought Trinity's British portfolio to 50 titles, making it the largest publisher of regional newspapers in the nation.
Two years later, in an effort to focus on its British holdings, Trinity sold 33 Canadian titles to Black Press Ltd. for $58 million. In 1998, the company sold its U.S. subsidiary, Trinity Holdings Inc., to a management-led group for $57 million.
By the late 1990s, Trinity's investment in regional publishing seemed to be paying off. Regional papers were enjoying sales rises and increased ad revenues, while national papers were experiencing a drop in circulation. Analysts ascribed the success of the regionals to efficiencies created by the consolidation of the industry and to the general strength of the economy. Some, however, also saw an increased desire on the part of advertisers to tailor their appeals to local audiences, resulting in double-digit increases in national advertising in regional papers. In 1998, Trinity's sales increased 5.4 percent, to $564 million. Profits leaped 43 percent, to $101 million.
That same year, Trinity began to pursue the acquisition of a major national newspaper publisher. The company began talks with the Mirror Group, a financially unstable but prominent publisher. Although the two companies eventually would merge, the negotiations were long and contentious.
Early History of Mirror Group
The history of Mirror Group rightly begins with the history of Alfred Harmsworth (Lord Northcliffe), the founder of the company's flagship paper, the Daily Mirror. In the words of the Times of London, Harmsworth was "unquestionably the greatest journalist of his time." The creation of the Daily Mirror was a critical episode in the revolution in British journalism wrought by Alfred Harmsworth and his brother Harold (later Lord Rothermere). Until the end of the 19th century, British newspapers and magazines had been written by and for the aristocracy and professional middle class, a relatively small percentage of the country's total population. Compared to most of the industrialized nations, Britain had developed a vigorous and often vitriolic press, but not until the last half of the 19th century did anyone propose seriously to publish a newspaper for the lower-middle and lower classes. Alfred and Harold Harmsworth, born to the family of an impoverished schoolteacher, eventually amassed fortunes, wielded enormous political power, and became members of the House of Lords.
Alfred Harmsworth exhibited his gifts for writing and self-promotion at an early age. As a grammar school student outside London he founded and edited the school newspaper. The young man pursued a career in journalism and began to contribute short pieces to the popular periodicals then coming into their own, such as Young Folk Tales and Tit-Bits. In 1887 he founded his own popular periodical called Answers to Correspondents. The magazine's title suggested its format, a collection of letters to the editor and his answers.
The title also suggested the nature of New Journalism as a whole. England's advanced economy had created a large middle class whose members, such as Alfred Harmsworth himself, were literate and curious about the world at large but uninterested in the higher arcana of politics, theology, and belles lettres. These readers, Harmsworth felt, hungered for publications that reflected and commented on their own middle-class lives, free of cultural pretensions, informative but simply written, and spiced with stories of love and violent crime.
In 1894 Harmsworth bought the moribund London Evening News for £25,000 and completed the triumph of popular daily journalism, aided by a talented young editor named Kennedy Jones and by his brother Harold, who would remain the financial and administrative director of the Harmsworth syndicate. Two years later the Harmsworth brothers founded the Daily Mail, a morning paper that experienced astonishing success from its initial publication date, when it already boasted the world's largest daily circulation. The secret of Harmsworth's success was summed up in his phrase, "explain, clarify, simplify," or perhaps more frankly in the formula articulated by Kennedy Jones: "Crime, love, money and food." In truth, the Mail (and later the Mirror) did not seem to follow any particular editorial philosophy. It did combine elements of ultranationalist politics, sex and violence, sports, cartoons, and advice columns, all written in brisk humorous prose and framed by bold black headlines.
These were papers for the plain-speaking common man, a market long associated with the United States but mostly unrecognized in England until Harmsworth provided the "daily mirror" in which they could recognize themselves. Nor were women excluded from this democratic awakening; the Daily Mirror owed its origin to Alfred Harmsworth's rare sensitivity to women as a newly emerging force in the political and cultural life of England. In 1903 Harmsworth established a paper written entirely by and for women. This "enlightened" experiment lasted about a year, the women of England for unknown reasons failing to rally around the Mirror as anticipated. The Mirror's weekly losses of £3,000 soon convinced Harmsworth that "women can't write and don't want to read." He dismissed the female staff, replacing them with the usual gang of cigar-smoking men and relaunched the paper in 1904 with a lead story entitled, "How I Dropped £100,000 on the Mirror."
The success of the new Mirror was not predicated on the gender of its editors, however. Harmsworth took advantage of recently evolved technology to make the Daily Mirror the first halfpenny paper in England illustrated with photographs, which until that time had appeared in newspapers rarely and at substantial cost. The Mirror's photographs were sharp and clear and inexpensive, and the paper soon was known for its front-page photos of the royal family, war scenes, and famous criminals. The liberal use of photographs, combined with the usual Harmsworth mix of letters, gossip, contests, and short news articles, proved to be a powerful lure for the English working class. Circulation shot upward to 350,000 in 1905 and six years later topped the one million mark, making the Mirror the world's first daily to reach that figure.
The Mirror was edited in these years by Alexander Kenealy, an Irishman whose instinct for sensational news had been honed by years of work with publishing magnate William Randolph Hearst in the United States. Under Kenealy, the Mirror took a further turn toward the journalism of titillation and sensationalism, eventually going too far to suit Alfred Harmsworth himself. The publisher, who was made a baronet in 1905, wanted to exercise power in the political as well as commercial sphere and he found the Mirror something of an embarrassment. In 1908 Harmsworth bought the Times of London and rapidly lost interest in the Mirror, which he sold to his brother Harold in 1914. The elder Harmsworth went on to a career of frustrated political campaigns and a growing megalomania; he was remembered by Prime Minister Lloyd George, as "far and away the most redoubtable figure of all the Press barons of my time. He created the popular daily, and the more the other journals scoffed ... the more popular it became." More typical of upper-class feelings, however, were the words of Lord Salisbury, who charged that Harmsworth had "invented a paper for those who could read but could not think, and another for those who could see but could not read."
The Mirror in the World Wars
Harold Harmsworth (Lord Rothermere) was a businessman of talent, and for some years the Mirror prospered under his ownership, helped especially by the public's hunger for photographs of the fighting in World War I. By 1917 the Mirror was the most popular daily in Great Britain, but Rothermere's obsessive criticism of governmental waste eroded the paper's circulation base in the 1920s. Like his brother, Rothermere could not resist trying to play the power broker in his nation's political life. The Mirror remained essentially conservative, as it had always been, but Rothermere used the paper as a vehicle for voicing his private feelings about the leaders of the Tory Party, for years attacking the government for alleged inefficiency and corruption. The culmination of this campaign was Rothermere's founding of the United Empire Party in the late 1920s, a short-lived far right-wing party whose jingoistic statements presaged Rothermere's later support for fascism.
Rothermere's fulminations were politically ineffectual and eventually proved to be bad for business as well. With the Mirror's circulation sinking quickly Rothermere sold his shares in 1931, his reputation permanently damaged by the rebukes of fellow conservatives such as Stanley Baldwin. "What the proprietorship of these pages is aiming at," said Baldwin in a famous 1930 speech, "is power, and power without responsibility--the prerogative of the harlot through the ages."
The politically turbulent 1930s witnessed the birth of a new, radical Daily Mirror. While Lord Rothermere formally adopted the fascist philosophy of Hitler and Mussolini, his former paper became one of England's leading advocates of democratic rights and armed resistance to Hitler's growing power in the east. Of the four men chiefly responsible for the new Mirror, three of them--editors H.G. Bartholomew and Hugh Cudlipp, and columnist William Connor (pen name "Cassandra")--were by birth and temperament sympathetic to the working classes; the fourth, Cecil Harmsworth King, was the nephew of founder Alfred Harmsworth. Together these four men created the Daily Mirror of which historian A.J.P. Taylor would later remark, "The English people had at last found their voice."
It was an irreverent, loud voice, in which could be heard elements of both high principle and low culture, semi-pornographic cartoons side by side with early and accurate warnings about the menace of Hitler. In 1934, years before most of England's high-brow papers gave up the rhetoric of "appeasement," the Daily Mirror characterized the German dictator with startling prescience as "the hysterical Austrian, with his megalomania, based on an acute inferiority complex, his neurasthenia, his oratorical brilliance." The Mirror's enthusiasm for confrontation would vary in the years following, but from 1937 onward it was England's leading proponent of the rearmament needed to deal with "the gangsters" of Europe.
In this sentiment it found an ally in none other than Winston Churchill, one aristocrat whom the Mirror supported during the 1930s and the first years of war. As the symbol of embattled Britain, Churchill could rely on the applause of the Mirror, which if nothing else had always identified itself with the interests of England. The Mirror, though, was an essentially iconoclastic journal with leftist leanings and soon it was criticizing the coalition government for various failings, in 1942 nearly suffering censorship for publishing what Churchill believed were demoralizing statements. By war's end the Mirror had fully resumed its prewar support for the Labour Party, helping defeat Churchill in the 1945 election. As always, the Mirror reflected and amplified the beliefs of its two million-plus readers, who in 1945 were overwhelmingly pacifist and neo-Socialist in their feelings.
In 1951 Cecil Harmsworth King deposed H.G. Bartholomew as chairman of the Mirror. The paper was probably then at the peak of its influence, the leading daily in all of Great Britain (possibly in the world) and the voice of the New Left that would dominate the country's politics for the next 30 years. Cecil King took the paper several steps further, however; it was under King's leadership that the Mirror expanded from newspaper to "Group." For years the Mirror had published a successful weekend edition called the Sunday Pictorial, and to this core King added a vast collection of magazines by taking over the Amalgamated Press in 1958 and Odhams Press a few years later. The holdings from the latter deal included a leading Labour newspaper, the Daily Herald. Along with the Daily Record and Sunday Mail, both of Glasgow, Scotland, the Mirror and its newly acquired magazine empire were all merged in the early 1960s into the International Publishing Corporation (IPC), described by Hugh Cudlipp in his 1962 book At Your Peril as "the greatest publishing operation the world has ever seen."
IPC owned the leading publications in virtually every category of British journalism, its power so great that in 1961 a parliamentary committee was formed to determine whether the Mirror takeover of Odham should not be prohibited by the government for reasons of free trade and the general good. The merger went through anyway, and IPC became one of the world's first "media conglomerates," as they would later be called, and Cecil King, like his uncle Alfred Harmsworth, established himself as a "media baron."
King's long and remarkable career ended abruptly in 1968 with his resignation under pressure from the board of directors. IPC's profits apparently were suffering from the entrenched power of its printing unions, power fought for and won with the help of newspapers like IPC's own Daily Mirror. The English printers union was a strong one, and it adamantly opposed new technologies that would cut costs at the expense of union jobs. Cecil King despaired of the situation, and two years after his departure IPC was merged with Albert E. Reed & Co. Ltd., one of the largest paper products companies in Europe. IPC had long been the largest shareholder in Reed (the Harmsworth brothers became involved in the Canadian paper business as early as 1906) and in 1970 the two firms banded together in the interests of vertical integration under the name of Reed International.
The Maxwell Years: 1984-91
Reed had no more luck with the printing unions than had IPC, and one by one the pieces of its publishing empire were sold off during the 1970s, starting with the magazines. Last to go were the Mirror newspapers, which then as now consisted of the Daily Mirror, Daily Record, Sunday Mirror, The People (a glossy Sunday spread), the Sunday Mail, the Sporting Life, and the Sporting Life Weekender. Reed could find no buyer for the Mirror newspapers, however, and a plan to float the group on the public exchange was ruined when Price Waterhouse discovered gross union laxities and described them in its prospectus statement. At the last minute an unlikely white knight appeared in the form of Robert Maxwell, Czech-born business dealer extraordinaire, who purchased the Mirror papers for about £90 million in 1984.
Mirror Group Newspapers Ltd. (MGN) became a pillar of Robert Maxwell's incredibly tangled business empire, a mysterious world in which the distinction between private and public companies was regularly ignored by Maxwell and his sons Ian and Kevin. A former MP for the Labour Party and a professed friend of the working man, Maxwell, according to many critics, had little regard for anything beyond his own insatiable desire for fame, and he had long coveted a public platform such as MGN offered. He took over MGN editorial policy while denying that he would even be interested in doing so, and by threat of company closure persuaded the unions to cut their employee levels and relinquish a host of archaic union rules.
For the same reason, Maxwell did not hesitate to break the law when his financial network began unraveling in the late 1980s. His 1988 purchase of Macmillan, Inc., the American publisher, and Official Airline Guides, Inc., for which he borrowed a combined $3.35 billion, pushed his empire further into precarious territory. The anemic economy in 1989 sent the price of stock at Maxwell Communications Corporation (MCC) spiraling downward. MCC was the holding company for Maxwell's American interests and the collateral for many of the huge loans made to Maxwell's private holding companies at the top of the pyramid. To bolster MCC's falling share price, Maxwell engaged in a blur of desperate transactions, including the use of Mirror Group pension funds and other cash accounts to buy MCC shares and provide collateral for further new loans. Shortly after the first signs of imminent personal bankruptcy appeared in November 1991, Maxwell's body was found floating off the stern of his yacht, at which point his conglomerate fell to pieces in a welter of bankruptcy filings and criminal investigations.
Of all of Maxwell's holdings, MGN was probably the soundest at the time of his death, but the company sustained serious losses due to Maxwell's illegal business dealings. In its 1992 annual report MGN noted a one-time extraordinary loss of £421 million to cover the cost of repairs, but the company also showed a healthy operating profit of £91 million on revenues of £460 million.
Mirror Group Expansion in the 1990s
After years of litigation, Mirror Group recovered a portion of its lost pension funds, and the shaken company seemed on its feet again. Hopes for economic security were based on further expansion. In 1994, the Mirror Group led a consortium of media interests in the takeover of the Independent. The Independent was founded in 1986 as a nonpartisan London daily. The paper at first prospered, as it was perceived to offer respectable and unbiased reporting, in contrast to the London Times, which was regarded by many as having declined in quality since being taken over by media magnate Rupert Murdoch. But financial losses in the early 1990s, coupled with gradual ebbing of circulation to its wealthier rival paper, eventually led the Independent to solicit a buyer. The consortium led by Mirror Group paid an estimated $110 million for the paper, and MGN was to have a 25 to 30 percent share. Its share was later upped to 46 percent.
Mirror Group's other significant expansion at this time was the launch of its cable television channel, Live TV. MGN put £2.9 million into the cable channel, which featured an irreverent take on the news. One of its most popular innovations was the News Bunny, nothing more than a broadcaster delivering the news while dressed as a rabbit. After a rocky start, Live TV gained a significant share of the British cable market.
By 1995, Mirror Group seemed to have put its financial troubles behind it. Profits that year were up 12 percent, and circulation of its flagship Daily Mirror inched up almost 2 percent. Meanwhile, its rival the Sun lost almost 3 percent of its circulation. The Group's other titles also showed increasing circulation. Management claimed that it had bolstered its papers by editorial improvement and strong marketing, not by cutting cover prices.
Further expansion came in 1997, when Mirror Group paid £297 million ($502.1 million) for Midland Independent Newspaper plc, publisher of the Birmingham Post and the Birmingham Evening Mail. This purchase was expected to boost MGN's presence in the Birmingham area, where its Live TV station was already popular.
Mirror Group was constrained from further television expansion by antimonopoly laws, and competition among the top newspaper conglomerates made every tenth of a percentage point fluctuation in circulation a battle. In 1998, the company reshuffled top management, bringing Live TV's managing director, Kelvin MacKenzie, in as managing director for the whole group. MacKenzie had formerly managed the Sun, the main competitor to the Daily Mirror. This shake-up came as the director of the Group's Scottish papers resigned and circulation of the Group's Sunday papers appeared to be falling.
When the Group announced its 1997 fiscal results in March 1998, profits were up 12 percent, and sales had climbed slightly less than 4 percent, to £559 million. Nevertheless, circulations at its papers were now declining, and the Group was forced to drop its cover prices in response to its competitors lowering theirs. The flagship paper Daily Mirror, long number two to the Sun, was in danger of losing its place to the Daily Mail. In addition, the Independent, which Mirror Group had acquired four years earlier, was suffering greatly in response to price cuts and promotions by its two main rivals, Rupert Murdoch's Times and the Daily Telegraph. Losses at the Independent had approached £10 million for the past several years, and Mirror Group announced in March 1998 that it would sell its stake in the ailing paper. This bad news overshadowed the rosy fiscal picture.
Merger of Trinity and Mirror Group
Intense competition between the leading national newspapers continued, and in 1998 the Daily Mirror lost more market share, falling into third behind the Daily Mail. The company's stock fell to a low of 136 pence a share in October 1998, and two companies made serious bids to take over the Mirror Group. Trinity made an all-stock offer of 160 pence a share, and Candover Investment Trust offered 200 pence a share. Mirror Group turned them both down, and an internal struggle between Mirror Group's chief executive, David Montgomery, and the nonexecutive chairman, Victor Blank, came to a head.
Montgomery, who was credited with saving the company after Maxwell's plundering, had seen his popularity decline through the mid-1990s. Journalists, many of whom had lost their jobs to Montgomery's cost-cutting, criticized him heavily. When takeover offers appeared, Montgomery was accused of thwarting their success in an effort to protect his position in the company. In January 1999, Blank threatened to call for a no-confidence vote at a board meeting. When Montgomery failed to get the company's institutional investors to back him, he resigned.
Trinity upped its offer to 210 pence a share in March, which valued Mirror Group at $1.53 billion. Mirror Group refused again, and continued in talks with Candover Investment. In July 1999, however, Trinity announced its purchase of Mirror Group for £1.24 billion, or approximately $2 billion. The combined company, named Trinity Mirror plc, would be the largest newspaper publisher in Britain. Philip Graf, chief executive of Trinity, was appointed to the same position for Trinity Mirror. Regulators required Trinity to sell its newspapers in Northern Ireland, including the Belfast Telegraph, to complete the deal.
Soon after the merger, scandal disturbed the new company. Trinity Mirror admitted that it had overstated the circulation figures for its Birmingham newspapers. For six years, the company had inflated the figures for the Birmingham Evening Mail and the Sunday Mercury by about 17 percent and the figures for the Birmingham Post by about 10 percent. The company agreed to compensate advertisers, who paid for ads based on circulation figures.
In 2000, Trinity Mirror purchased Southnews, a newspaper publisher based in London, for £284.6 million. The company also completed its required sale of the Belfast Telegraph; Independent News & Media purchased the title for £300 million. The same year, Trinity Mirror expanded its ic brand of web sites, with several new regional web sites, including icscotland.com, and several content-based web sites, including icshowbiz.com.
Trinity Mirror sold its Internet service provider, ic24, in 2001. It also announced plans in July of that year to reduce its workforce by 800 jobs over the next three years in an effort to reduce costs. In addition, the company suffered a downturn in advertising sales in 2001, along with the rest of the industry. Following the September 11 terrorist attacks on the World Trade Center, advertising went into a severe decline, with a 10 percent drop for the Daily Mirror and the Sunday People in October and a greater than 21 percent drop in November. In response, the company's shares fell by 14 pence.
Although advertising revenues continued to fall in the first quarter of 2002, Trinity Mirror announced plans to spend an additional £25 million in editorial revamping and marketing for the Daily Mirror. An effort to reposition the paper as a more serious tabloid had met with a positive response from readers. To cut costs, Trinity Mirror contracted its national advertising sales for the Mirror, Sunday Mirror, Sunday People, the Daily Record, and the Sunday Mail to Apollo Sales, a new sales subsidiary of the Telegraph Group. Although Apollo Sales also would handle advertising sales for the Daily Telegraph and the Sunday Telegraph, analysts foresaw little chance for Apollo to abuse its position with cross-selling.
In addition to continued declines in advertising revenue, newsprint prices were rising. The crunch for Trinity Mirror led the company to raise its expected job cuts to 1,100 by 2003.
Principal Subsidiaries: MGN Limited; Century Newspapers Ltd.; Derry Journal Ltd.; The Sunday Business Post; Scottish Daily Record & Sunday Mail Limited (Scotland); Scottish & Universal Newspapers Ltd. (Scotland); Insider Group Ltd.; Newcastle Chronicle & Journal Ltd.; Gazette Media Company Ltd.; Liverpool Daily Post & Echo Ltd.; The Chester Chronicle & Associated Newspapers Ltd.; Examiner News & Information Services Ltd.; Wheatley Dyson & Son Ltd.; Birmingham Post & Mail Ltd.; Coventry Newspapers Ltd.; Trinity Publications Ltd.; Midland Weekly Media Ltd.; Trinity Mirror Southern; Inside Communications Ltd.; Western Mail & Echo Ltd.
Principal Divisions: Regional; National; Sport; Magazines and Exhibitions; Digital Media.
Principal Competitors: Daily Mail and General Trust plc; Guardian Media Group; Johnston Press plc; Newsquest plc.
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