RIGA - Rupert Murdoch has called for China to allow a more open media sector, that Beijing needs to compete in a global "marketplace of ideas," reported The Financial Times last week. The paper went on to quote editor-in-chief of Reuters David Schlesinger saying "All involved need to help the media help society by accepting that while openness, transparency and accountability may lead to momentary discomfort and sometimes embarrassment, they are ultimately worthwhile."
Diena, the leading Latvian language daily newspaper, was in July bought, along with sister publication Dienas Bizness, by Luxembourg based Nedela S.A. in a highly clandestine transaction. In what is par for the course in Latvia, it has been a guessing game in determining the identities of the owners behind Nedela.
Nedela's board director Alexander Tralmaks first said the purchaser was one of the founders of Skype. Then he changed his story, saying it was one of the owners of Estonia's Ekspress Group. The wild goose chase seems to be settled now with the new owner revealed as the UK-based Rowland family.
The deal was initially structured as a loan to Tralmaks' company Nedela, allowing it to buy the two papers from then-owner, Sweden's Bonnier Business Press. The loan has now been restructured, placing the Rowlands as the new owners, reports news agency LETA.
Tralmaks, in a letter to staff in July, noted that the paper, which has been losing money for years, must work in society's interest and at the same time be a successful business. Diena's position on the market has weakened, and it lost many readers over the past several years. Formerly an undeniable leader and the largest newspaper in Latvia, it has become just one of the mass media in Latvia, as increasingly many residents prefer reading news on the Internet, where Diena's market share is small.
As Tralmaks moves to cut costs, key employees have started their exodus. In an Oct. 10 letter to readers, former Dienas mediji editor-in-chief Nellija Locmele said that she doubts that the new ownership will maintain as its long term business model one of quality journalism. At least eleven Diena employees have already handed in their resignations, including Locmele, Diena editor-in-chief Anita Brauna and commentator Pauls Raudseps.
Editor-in-chief of Dienas Bizness, and acting editor-in-chief of Diena, Dace Andersone said "we held talks with departments to get a full picture of what resources we still have and what we lack to be able to ensure constant quality and issue frequency; there is no doubt that the newspaper and its supplements will come out tomorrow, the day after tomorrow, and afterwards."
Jonathan Rowland, 33 year-old member of the Rowland family, says that "I would like to emphasize that for us it is solely an attractive financial investment…" This is the family's first investment in the Baltics, and they have no prior investments or experience in the publishing business.
The Rowlands, father David and son Jonathan, are estimated to be worth 900 million euros, have a history of smart investing, reports the on-line Wealth Bulletin. Their recent investments, however, tend to "lending to those squeezed by the credit crunch."
Jonathan Rowland has previously said that "We are looking at opportunities in the property sector, particularly at deals in the U.S., where it's getting impossible for people to raise finance if they want to carry out developments."
The Rowland Capital family office has put together debt and equity finance for companies in the real estate, technology and mining sectors, for several years. It runs an asset management business, Blackfish Capital Management. A fund investing in distressed and high-yield debt is planned.
Comments such as "We want to build the [Blackfish Capital Management] brand and earn a decent return. I'd like us to be managing $1 billion over the next five years. Our primary focus is organic growth. We might consider acquiring businesses but it isn't our main strategy" don't support the thesis that the Rowland family is interested in buying and running a newspaper group in Latvia.
Tralmaks and his team are expected to remain responsible for the paper's management, which is rapidly merging Diena with Dienas Bizness, and they say this transition process will be completed by Nov. 1.
Initially, it was planned that the merger of both newspapers' editorial boards would gradually take place until the end of this year, however, the current situation puts pressure on taking action sooner due to the fact that now some of Dienas Bizness' journalists and editors have to also work at Diena.
Diena will still be printed as usual, thanks to the 'patriots' of the paper who have not left and continue working, says Andersone. She stresses that "it would be wrong to believe that all the best journalists have quit, as many Diena professionals continue on. Diena will not change course."
Andersone pledges that the newspaper's fundamental values - quality, responsibility, freedom of speech - will not change. She says that Diena will remain "an independent newspaper not representing any political or economic forces. These are the values that I believe in, the values that must be the cornerstone of quality journalism."
The nascent view among some is that the Rowland family is acting as a front for a group of Latvia's so-called oligarchs, who might be the real owners of the paper. Targets of frequent attacks on the paper's commentary pages, they would have good reason to want to close down the paper, and any criticism, ahead of next year's parliamentary elections.
"There is a need in Latvia for an independent newspaper, which is not now served by the other major dailies. If Diena closes, there goes democracy," says one reader.
