Pearson, publisher of the Financial Times, sold its Spanish media company Recoletos in a deal valued at US $966 million, saying that Recoletos does not fit with the financial and business focus of the FT Group. In January, Recoletos launched the free daily Qué Diario in 12 Spanish cities with a combined circulation of 1 million. Insiders note that the launch of Qué Diario was one of the main reasons for Pearson's decision to sell Recoletos to Retos Cartera in a management buyout lead by Recoletos president Jaime Castellanos and CEO Alejandro Kindelan. Retos Cartera is 28.6% owned by Banesto, a subsidiary of Banco Santander. The rest is owned by Recoletos management or persons close to it.
…could impact US and Latin American holdings
Pearson's Financial Times recently reported that Pearson was unenthusiastic about “Recoletos' plans to launch a free general interest daily,” and “its recent US expansion with four tabloids aimed at the Spanish-speaking market in Texas.”
Giovanna Rueda, marketing director at Meximerica Media (publisher of Rumbo), told Portada® that the announcement that a group of investors led by Recoletos management had made an offer to buy the company from Pearson would not affect in any way Recoletos' interest in Rumbo. Rumbo's U.S. plans will remain the same. Recoletos says that they are “thrilled to be involved in this venture and will continue to invest in Meximerica Media.”
Recoletos has an important presence in Latin America and the US Hispanic market. It publishes four Spanish-language dailies in Texas under the Rumbo banner (see “First Major International Investment in Hispanic Print,” page 1, Portada® No. 9, May/June 2004). In Argentina, Recoletos publishes El Cronista Comercial, a daily specializing in the economy and financial news, and the monthlies Apertura (economic news) and Information Technology. In Chile, Recoletos and the Claro Group manage the Ediciones Financieras company, publishers of Diario Financiero. The Madrid based company also publishes a sports newspaper in Mexico.
More free dailies in Spain…
The January launch of Qué Diario (Recoletos) increases the competition in an already thriving Spanish free daily newspaper market. During the last few years free dailies have built a strong reader base, and more importantly, captured a substantial part of the Spanish newspaper advertising market. The Swedish newspaper group Metro International publishes free dailies in 7 Spanish cities (total circ. 700,000), while Norway's Schibsted publishes a version of the free daily 20 Minutos (also in 7 Spanish cities – total circ. 700,000). Qué Diario is now available in 9 cities. Additionally, 20 Minutos is launching 20 Negocios, a free financial daily with an expected circulation of 70,000. According to a recently released study by EGM/Spain, Metro and 20 Minutos are the second and third most read Spanish newspapers, surpassed only by the paid daily El País.
…and looking into Latin America and the US.
Some of these free daily publishing ventures in Spain, most notably 20 Minutos, are interested in expanding into the US Hispanic market and Latin America (see “Are low-priced newspapers the key to success in Mexico and the US?” page 1, Portada® No. 3, May/June 2003). Their success in Spain gives them the financial means and know-how to expand their presence to other Spanish-speaking countries.