Moving with the Times
30 July 2015 by Lucinda Stacey
The recent news of the Financial Times being sold to a Japanese company, Nikkei, for £844 million ($1.32 billion) may come as a shock to many. Founded in 1888, the Financial Times began being printed on pink paper five years later and has become a symbol of the popular paper. In the 1980s, the name of the City’s leading share index began life as the Financial Times Stock Index 100, which is now simply known as the FTSE 100.
Pearson, who bought the Financial Times in 1957, said it decided to sell in order to focus on its far larger educational publishing business in the US. John Fallon, Pearson’s chief executive, said: “Pearson has been a proud proprietor of the Financial Times for nearly 60 years… In this new environment, the best way to ensure the Financial Time’s journalistic and commercial success is for it to be part of a global, digital news company.”
The bidding war for the Financial Times saw a last minute battle between the German company Axel Springer, who own the Bild tabloid, and Nikkei. The Japanese financial media company, who eventually bought the Financial Times, are said to have put in a last minute bid at the eleventh hour to secure the deal. Nikkei, an abbreviation of “Nihon Keizai Shinbun” which means “Japanese Economic Newspaper”, dominates Japanese-language business media with 3.16 million paid subscribers. Nikkei was founded in 1876 and is one of the largest media companies in Japan, spanning newspapers, broadcasting, magazines and digital media. Supposedly, Nikkei had been trying to break into English-speaking international markets for decades.
The Financial Times sale price dwarfs the price paid for the Washington Post in 2013 which was sold for $250 million. Yet this price does not include Pearson’s 50% share in the Economist group or the Financial Time’s headquarters building by the Thames in London. Accordingly, Nikkei will pay a commercial rent for the building at One Southwark Bridge once the takeover is finalised at the end of the year. Pearson is now expected to negotiate a separate sale of their stake in the Economist Group; the highly profitable publisher that owns the Economist magazine and the Economist Intelligence Unit.
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