Focus, one of the country’s leading weekly news magazines, was sold by former owner UMH Group to two Odesa-based businessmen with no previous media experience.
On May 17, media tycoon and
UMH owner Borys Lozhkin announced Focus is being sold for an undisclosed amount
to Ukraine-based Vertex United, controlled by Odessa businessmen Borys Kaufman
and Oleksandr Granovskiy. The sides expect to complete all legal formalities
within two months.
“According to the signed contract, the
management of the project in terms of sales, advertising and circulation, as
well as the organization of the necessary production and marketing processes
until the end of 2013, will be carried out by UMH Publishing,” an UMH statement
read. Together with Focus, UMH Group also sold its travel supplement Focus.Beautiful
Country and the focus.ua website.
The press service of UMH Group stated that Gennadiy Bogolyubov’s stake in Focus — the billionaire member of the so-called Privat Group — also sold his shares. The size of his stake, however, remains unknown.
UMH’s Lozhkin
laconically commented on the deal. “We are satisfied with the results of this
business project,” he said through his press service.
Ukraine’s media ownership landscape is shrouded in non-transparency and is highly concentrated to a handful of owners, media experts have noted.
Lozhkin had earlier
spoken about consolidating UMH’s media assets ahead of an initial public
offering, which experts expected to take place on the Warsaw Stock Exchange
once the market revived. At the end of April he told Kommersant newspaper he
was in talks with Bogolyubov about the repurchase of Privat’s stake in Focus. He
also said Focus and Korrespondent, another weekly owned by UMH, had different
audiences meaning they would not need to sell one.
“The specialty of Focus has always been its
ratings. In some ways magazines will overlap, but we do not see this as a
problem,” Lozhkin emphasized.
However, ratings show Korrespondent
as being the more successful of the two. According to respected international
research group TNS, in the fourth quarter of 2012 and first quarter of 2013,
each issue of Korrespondent was read by about 221,000 people, almost four times
more than the number of Focus readers. In April UMH became the sole owner of
Korrespondent after billionaire Petro Poroshenko sold his 50 percent stake.
The magazine’s new
owner Vertex United is best known for its hotel business. It owns President
Hotel in Kyiv, as well as Bristol and Londonskaya hotels in Odesa. Vertex also
owns FinBank, which is Ukraine’s 69th biggest by assets.
“For us the
acquisition of the media asset (Focus) is an image project within the framework
of business activity and overall business strategy,” Kaufman explained.
According to Forbes,
Vertex United owners Borys Kaufman and Oleksandr Granovskiy have an estimated
wealth of $37 million each. In 2011 media reports said they obtained a concession
to run Odesa Airport, after establishing the Odesa Airport Development company. In November, Forbes claimed, citing unnamed sources,
that the real beneficiary behind the airport concession deal was President
Viktor Yanukovych’s older son Oleksandr Yanukovych. This fueled media
speculation that Oleksandr Yanukovych is also behind the purchase of Focus.
Oleksandr Yanukovych’s
MAKO Holding, was quick to deny any links to the purchase of UMH media assets.
“At
the moment, MAKO group’s shareholder has no plans to acquire media assets. It
also doesn’t conduct any negotiations on the issue,” his press service said on June 18.
Kyiv Post staff writer Kateryna Kapliuk can be reached at
[email protected].
