Press Association shareholders would have the right to veto a potential shareholder if they had sufficient grounds to believe the bid may be seriously prejudicial to the company.
As Lord Hollick’s United Business Media looks for a buyer for its 17 per cent stake in the national news agency, the wide range of media companies – regional and national – with holdings in PA have been dusting off the rules that govern the sale of its highly profitable shares.
“In our articles, the directors do have some level of discretion in refusing to register the transfer,” said managing director Steven Brown. “They could refuse to approve the registration if they had sufficient grounds.”
It has never been done in PA’s history and Brown is hoping the shares will go into the hands of a customer “so we can retain that close link between ourselves and our customers.”
PA and its board have been aware for some time that UBM wants to sell its shares. Far from being alarmed that this may lead to a break-up of PA if other groups follow suit, Brown was buoyant when Press Gazette spoke to him this week.
“As far as I am concerned, all our shareholders are quite happy. They get a good dividend stream and they are all major customers taking all our services.
“UBM is different from the rest because over the years it has sold its newspaper interests, first its regionals and then the nationals. When it sold the nationals, it didn’t sell its PA shares with them. It alone is a shareholder which is not a customer of PA’s wire services.”
Richard Desmond, who bought Express Newspapers from Lord Hollick, is thought not to have been interested in the PA shareholding at the time of the acquisition.
PA has around 20 shareholders. Trinity Mirror has slightly over 20 per cent, News Corporation 16.5 per cent, Daily Mail & General Trust 14 per cent while Guardian Media Group, Midland News Association, Archant and Yattendon are among smaller stakeholders.
By Jean Morgan