The move comes months after Independent Star’s other key shareholder Northern and Shell threaten to pull the plug on the paper following the publication of photographs of Kate Middleton sunbathing topless in France last year.
It is understood that the fraught relationship between the two shareholders predates this incident and goes back to Northern and Shell’s decision to distribute copies of the UK’s Daily Star in Ireland two years ago, a move which is understood to have annoyed INM. However the UK version of the paper failed to make any inroads into the Irish market and the strategy ultimately backfired on Northern and Shell.
Under the new arrangement INM will take direct executive control of the paper and move it from its Dundrum offices into the group HQ on Talbot Street. Gerry Lennon, the managing director of the Sunday World will assume the role of MD of the paper while at the same time remaining on as MD of the popular Sunday title. Ger Colleran, the former MD of Independent Star will take up the role of editor of the paper, a position he held before he was appointed MD after the departure of Paul Cooke. In addition Mairead Kearns, the advertising director of the Sunday World will assume the role of advertising director of both titles.
Historically, Independent Star has been a very profitable business, generating good dividend income for both shareholders. In 2010, for example, the accounts show that it notched up a healthy operating profit of €4.3m on a turnover of €40.63m in the year to the end of December 2010. The pre-tax profit, meanwhile, amounted to €4.29m. During 2010 it was also able to pay a €4.55m dividend to its shareholders. .
In making the announcement this week, a statement from INM said that as a result of the transaction, there would be nine redundancies in the circulation and advertising departments while remaining staff will suffer pay-cuts of between 5-7%.