The major news in the past week has been German press manufacturer manroland filing for insolvency. This is the largest corporate failure in Germany for two years.
The company filed for insolvency in Ausberg, Germany and the insolvency court appointed Werner Schneider, a financial auditor and tax consultant as insolvency administrator. The court appointed lawyer Dr Frank Kebekus as general representative for the restructuring. manroland’s filed its request for self-administration to complete restructuring efforts. The company was forced into filing for insolvency by a dramatic downturn in incoming orders since July this year. manroland stated that it would act to rescue key units within the framework of its restructuring effort. So far this ongoing restructuring has seen a reduction in staffing from 8,656 in March 2009 to a current level of 6,500.
In recent weeks there have been suggestions that an investor from outside of the industry has been negotiating to acquire a stake in the company. This investor is stated to have surprisingly withdrawn, however perhaps a major degree of restructuring is required before any investment may happen. manroland stated “with the planned entry of a potential investor and on a basis of a financing programme coordinated with the previous shareholders and banks, the company’s equity base would have to be strengthened."
The current shareholders are insurance company Allianz holding 75 per cent of the share capital and German truck and engine maker MAN holds 23 per cent. Allianz is also the largest shareholder in Heidelberger Druckmaschinen, and tried two years ago to merge the two press manufacturers.
All suppliers are feeling the drop in demand for presses, particularly in the sheet fed market. In Germany it is felt in today’s market that there is insufficient demand to have three major sheet fed press suppliers. Perhaps any restructuring will concentrate on manroland’s web offset operations where the company claims it is the leading supplier in the world of such presses, and where it has fewer large competitors.
In recent month’s manroland has reached a distribution agreement with Océ to sell Océ continuous feed inkjet presses into its markets. So far to my understanding no sales of Océ equipment have been made or announced. While digital printing is seen as a major future business for manroland, I would imagine that any potential deals for Océ presses would be put on hold.
Will UK Newspapers be forced to change?
In the UK, following the outpouring of news of phone hacking at Rupert Murdoch’s News of the World, that was subsequently closed, a major multi-stage national government generated enquiry run by Lord Justice Leveson has just started. The first part of the judge-led investigation into the culture, practice and ethics of the press will take many months, but the first week of it has already generated huge amount of interest. In this a mixture of celebrities and other people whose lives had been impacted by phone hacking by journalists have given evidence.
These included actor Hugh Grant, best selling author J.K. Rowling, and the parents of murdered schoolchild Millie Dowler. From the initial hearings the lack of ethics and standards of the press has been very apparent. The inquiry is much more than just covering the phone hacking and is looking at the whole approach of the press. An interesting comment came from actress Sienna Miller whose phone was hacked by the News of the World and who received £100,000 in compensation from them. The actress described how 10 to 15 men had pursued her on a daily basis who abused her and did anything to get an emotional reaction. She questioned why having a camera made it legal for people to chase her.
Mark Thomson, the lawyer who has represented actors including Ms Miller, Jude Law and Hugh Grant as well as singer Lily Allen argued for a stronger regulatory system for the press. Mr Thomson said what was needed was a body with regulatory powers which could deal with journalists anywhere in the country.
I have worked with the UK newspaper industry over many years starting in the late 1960s in installing some of the first computer systems in newspapers. In that time I have found the editorial standards of the tabloid press have drastically fallen and the name “gutter press” is well justified. There is also the problem that it if someone who has been incorrectly reported in these papers complains these claimants are likely to be trashed with further stories about them for daring to complain. The Leveson inquiry is in fact giving an opportunity for such complaints now to be heard.
This inquiry will go on for a long time as it looks into all the aspects of press ethics, culture and practice. It will cover phone hacking and just how widely spread this has been. Almost nobody with any understanding of the press believes that phone hacking has just been carried out by just one newspaper. At the end of this inquiry the big question will be will the UK Government have the guts to take on the major newspaper publishers to endeavour to change the law and implement a new standard of control in this area, without impacting upon the need for investigative journalism.