Poor ad market shuts paper

The paper might live-on in a weekly format

The editor of Scotland's daily business paper has blamed the decision to close the title on "economic circumstances beyond anyone's control".

Business a.m. is to shut at the end of the week with 125 redundancies.

A small number may be re-hired by the London-based firm which publishes the weekly newspaper, Financial News, covering UK-wide private equity markets.

The company is in negotiations with business a.m.'s owners, the Swedish Bonnier AB Group, to buy the Edinburgh-based paper.

Scotland is already well-endowed with business supplements in major newspapers that people have traditionally read for many years

Bob Leitch
Scottish Chambers of Commerce

A Bonnier spokesman said the deal should be completed within the next couple of weeks and that business a.m. would become a weekly publication

Bonnier had been trying to find a financial backer for business a.m. since October.

There was said to have been a lack of interest because the move coincided with the Scottish Media Group's sale of its newspapers.

About £20m is reported to have been invested in business a.m. since its launch in September 2000.

But sales have fallen to about 11,000 a day against a break-even point in the region of 25,000, rival newspapers have claimed. Its cover price is 95p.

Buy-out failure

Managing editor and editor-in-chief John Penman said: "The achievement of business a.m. over the past two years is one which all the staff here can feel very proud of.

"We have established ourselves as Scotland's leading business title, our subscribers value the newspaper very highly and we have been recognised on many occasions by our peers in the newspaper industry.

"We worked very hard to maintain business a.m. in its existing format, including pursuing a management buyout.

Scotland's "big two" business sections

"Unfortunately, we were not able to realise these plans.

"We are the victim of economic circumstances beyond the control of anyone involved in this venture."

In a statement, Bonnier said: "The company felt it could not sustain continual losses when we have an advertising market that has very little sign of recovery.

"Bonnier is in advanced talks to sell the title to an existing media company."

'Familiar' titles

Scottish Chambers of Commerce director Bob Leitch said he was "sad and very surprised" at business a.m.'s closure.

But he denied that Scotland's business community was not interested in a dedicated daily newspaper.

"Scotland is already well-endowed with business supplements in major newspapers that people have traditionally read for many years," he said.

"Scots tend to stick with what they know and what they are familiar with rather than experiment."

'Regret'

Mr Leitch added that the title may have more success as a weekly, by providing more in-depth and specialised items.

Iain McMillan, director of CBI Scotland, the country's leading business organisation, said: "Scotland does not have enough people willing to start up new ventures and we wish all the staff good luck in finding new jobs."

A Scottish Executive spokeswoman said the paper's closure was to be regretted.

She added: "But we welcome the prospect of the continuing publication, albeit on a weekly basis, and hope there is scope for some of the existing business a.m. staff to be re-hired."