Troubled daily betting paper The Sportsman has had interest from a number of possible buyers, Press Gazette has learned.
Uncertainty hangs over the future of the paper, which went into administration last Thursday and employs around 70 journalists.
- October 2, 2020
- September 21, 2020
- September 15, 2020
But administrator Peter Kubik, of UHY Hacker Young chartered accountants, indicated the move into administration is by no means the end of the line.
He said: “On the media side of things, small newspapers have expressed an interest, venture capitalists haven’t yet, but [offers] may be via venture capitalists. There’s been interest from people who do a similar type of paper. Someone like the Telegraph isn’t looking at it, but smaller entities are.”
Asked how much investment is needed to save The Sportsman, he said it would be likely to be at least “£1 million-plus”. According to Kubik the chances of the paper getting this amount from existing or new investors was very good.
Kubik said he hoped that no jobs would be lost as there had been some redundancies prior to UHY Hacker Young taking over, and described staffing levels as “fairly lean as it is”.
The Sportsman launched in March with initial private funding of £12 million and a stated aim of hitting a 40,000 daily circulation to break even.
But its last ABC (for May) was 16,315 – a figure which dropped to 12,762 when bulk give-aways were discounted. Kubik said The Sportsman was put into administration because it had effectively run out of money.
He said: “It comes down to how much advertising revenue they get from it. They probably didn’t get to the level they required to sustain the overhead costs that they have at the moment. It’s quite a new company, so it’s quite expensive at the moment. I think that will settle down. This paper was built up from scratch so it’s a very expensive process. There’ve been some private investors through some corporate entities investing into this and they’ve put a lot of money in.
“They obviously got very concerned as to how much more money it would need and therefore put the company on notice that for the time being they weren’t willing to continue to fund it. It’s a question of the company putting in the administrators to see what should be done with the newspaper.”
Kubik added that the step to liquidation was “a totally different process”
and didn’t necessarily have to follow administration.
He said: “Administration is a recovery process to try to save a business, liquidation is fatal.”
Asked about steps after administration, Kubik said: “There are various exit routes from an administration. One being a company voluntary arrangement [a contract which allows the company to repay some or all of its debts from future profits], another being liquidation.
If it did go to liquidation it wouldn’t be the death of the paper, just a process to distribute the money to creditors.
“The paper would then be sold on to another corporate entity.”
NUJ national newspaper organiser Barry Fitzpatrick said: “We’re disappointed that they’ve hit this problem so early into their launch. Maybe if they’d have had some more money to spend on the launch and focused a bit more on the online division they could have had a better chance.”
A Sportsman spokesman said: “We hope this period is as quick as possible and the administrators deal with the reinvestment issues. We would hope that should be a matter of weeks and the administrators seem bullish that it should be quick.”