OLD Media Moves

FT accused of jacking up cover price

November 12, 2012

Posted by Chris Roush

Louise Armitstead of The Telegraph in London writes that an analyst that follows Pearson Plc, the parent of The Financial Times, has written a scathing report accusing it of unnecessarily increasing the cover price of the paper and that the FT is not worth as much as what has been reported.

Armitstead writes, “The analyst said that Pearson was likely to sell FT Group to focus on its education business but claimed the newspaper is worth just £150m. With its 50pc stake in The Economist magazine, FT Group could fetch £600m to £700m, even with the so-called ‘trophy asset’, Mr Braley said.

“‘To get to a valuation of £1bn seems to rely on that kind of buyer who might also be in the market for football teams, art, pigs with mystical healing powers and trips into space,’ he said.

“‘That does not seem to us to form any reasonable part of an investment thesis.’

“He added: ‘The issue is simply that the FT isn’t a very profitable business, prospective strategic buyers are limited.'”

Read more here.

Subscribe to TBN

Receive updates about new stories in the industry daily or weekly.

Subscribe to TBN

Receive updates about new stories in the industry.