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Struggling Business Newspaper City AM Nears Administration Amidst Unsuccessful Auction
City AM, the renowned London-based business newspaper, is teetering on the edge of administration as its weeks-long quest to find a buyer has hit a dead end. Despite exhaustive efforts, no solvent deal materialized, pushing the title’s directors to consider appointing BDO, the accountancy firm, to initiate an insolvency process in the near future.
COVID-19 Pandemic and Commuter Footfall Declines Hit City AM’s Advertising Revenues Hard
Sources indicate that City AM’s advertising revenues have been severely impacted by steep declines in commuter footfall due to the COVID-19 pandemic. As the number of commuters reduced, so did the newspaper’s reach and advertising potential, leading to financial challenges. Moreover, soaring print costs have added to the strain faced by City AM and its competitors.
Prospect of Pre-Pack Sale Looms as Administrators are Considered
With the search for a buyer yielding no fruitful results, an insider suggests that a pre-pack sale might be the most viable option. A pre-pack sale involves the appointment of administrators to facilitate an immediate sale of some of the company’s assets. It appears increasingly likely that City AM will proceed with this approach, with a notice of intention to appoint administrators expected this week.
City AM’s Journey So Far: Ownership, Circulation, and Challenges
City AM, which has been distributed at hundreds of transport hubs and locations in London and the home counties since 2005, has a daily print run of 70,000 and an audited circulation of over 67,000. The newspaper’s ownership structure comprises a 50% stake held by a group of Dutch investors, with Lawson Muncaster, managing director, and Jens Torpe, chief executive, holding 25% each. Despite facing financial challenges, Mr. Muncaster expressed optimism about the brand’s potential for expansion and growth in the changing media landscape.
Shifting Commuter Habits and Impact on City AM’s Publishing Schedule
In response to changing commuter habits, particularly with workers appearing in the office only on Tuesdays, Wednesdays, and Thursdays, City AM took measures to adapt. The newspaper ceased publishing its Friday edition in January, effectively becoming a four-day-a-week title. This strategic move aimed to align the publication’s schedule with the evolving work patterns during the pandemic.
City AM’s Prospects Amidst Ongoing Uncertainty
City AM’s future remains uncertain, and potential buyers are assessing the viability of the newspaper as a digital brand. While the publication boasts up to two million monthly unique website visitors, the pandemic’s impact on commuting and corporate advertising, combined with Brexit-related challenges, has significantly affected its traditional print business. As the newspaper’s journey unfolds, administrators prepare to step in, and the media landscape continues to evolve, City AM’s fate remains at the mercy of market forces and its ability to adapt to the digital era.