PARIS/MILAN (Reuters) - Italian media group L’Espresso bowed out of bidding for French newspaper Le Monde, while Spain’s Prisa said it wanted to take part in the paper’s recapitalization but asked for more time to make a final bid.
Le Monde, one of France’s most respected newspapers, is set to lose its prized independence as mounting losses force it to seek up to 100 million euros in a recapitalization. It is seeking an outside investor to stem its losses and pay its mounting debts.
Final bids are due on Friday. The board is supposed to meet on Monday to weigh them, and the journalists must then vote on the final choice.
The grave situation at Le Monde reflects broader woes of the French newspaper industry, as advertising revenues have fallen, the Internet has eaten into readership numbers and an antiquated distribution system has pushed up costs.
Italy’s L’Espresso ESPI.MI , which owns Italian daily La Repubblica, said it studied the plan for the recapitalization of Le Monde but in the current circumstances has decided not to make an offer.
Swiss media group Ringier also pulled out, on Tuesday, citing the cited the short timeframe and complexities of the bidding process.
Two French bids remain. One is from Claude Perdriel, the chief of the Nouvel Observateur magazine group and board member of Le Monde, who is seeking a partner to invest alongside him.
The other is an unlikely trio of Lazard Ltd (LAZ.N) banker Matthieu Pigasse; French Internet tycoon Xavier Niel, who founded the telecommunications group Free (ILD.PA); and Pierre Berge, a wealthy industrialist and patron best known as the long-time partner of designer Yves Saint Laurent.
The trio has already deposited its bid, while Perdriel is likely to submit an offer Thursday morning, French financial newspaper Les Echos reported Wednesday night.
The lone remaining foreign bidder is Prisa (PRS.MC), publisher of El Pais newspaper, which is already a shareholder in Le Monde.
But Prisa thinks the calendar being imposed on bidders is too tight; in a letter to the board on Wednesday it asked for the process to be extended through September to allow all potential investors to make a more complete audit of the paper’s financial needs.
The calendar had been set the way it is because Le Monde’s financial situation is so precarious that it might not be able continue operations through the summer without a cash infusion.
One possibility would be for potential investors in the recapitalization to provide the paper with some sort of bridging loan. Prisa suggested as much in its letter: “Each candidate could provide Le Monde with an advance to be reimbursed later to provide for its cash needs until the recapitalization can be finalized.”
It’s not clear whether the other bidders would be willing to offer such financing.
The entry of other bidders or investors at this stage is still possible.
On Tuesday, France Telecom FTE.PA Chief Executive Stephane Richard told Reuters in an interview that the operator would be interested in a partnership with Le Monde but would not invest directly in the recapitalization.
Media reports have floated the idea that France Telecom might join Perdriel’s bid in some form.
Additional reporting by Liz O'Leary, Robert Hetz, editing by Gerald E. McCormick