Media News - Tuesday, May 20, 2008

Aftonbladet ditches free paper

Swedish tabloid newspaper Aftonbladet has decided to ditch its free sister paper Punkt SE. The move comes after Norwegian media giant Schibsted announced it had bought 35 percent of the shares in Metro Sweden for SEK 350m (EUR 37m). Schibsted, which owns both Aftonbladet and Svenska Dagbladet, also said it was entering into an advertising agreement with Metro. Aftonbladet's brief flirtation with the free newspaper market was a financial failure. In 2007 Punkt SE made a total loss of SEK 198m. For the first quarter of 2008, the free paper ran a loss of SEK 44m. The costs of the closure are expected to amount to SEK 65m, said Schibsted in a statement. Schibsted's Sweden manager Gunnar Strömblad said Metro Sweden was a good match for the company's existing newspapers. Schibsted expects its collaboration with Metro on the advertising market to result in income synergies of SEK 40-50m after two to three years. The Norwegian company's share acquisition also entitles it to two places on the board of Metro Sweden. Before the deal goes through however, the companies must receive approval from the Swedish Competition Authority (Konkurrensverket). (The Local)

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