Guardian Media Group chair Charles Gurassa has written an open letter explaining the rationale for selling The Observer to Tortoise Media.
Under the deal GMG will invest £5m in the new merged Tortoise/Observer title. Tortoise has raised a further £20m of investment.
The Observer will continue to appear in print as a Sunday newspaper but also have its own paywalled website.
Gurassa and the rest of the Guardian leadership team have faced fierce opposition from staff following news that the Tortoise deal had been agreed by Guardian owner The Scott Trust.
Guardian Media Group chair’s open letter in full:
Gurassa writes: “As plans around the proposed sale of the Observer have progressed in recent months, the passion for preserving the paper’s rich legacy and protecting its future has been clear for all to see. I share that commitment and thought it important to explain why the Guardian Media Group and the Scott Trust believe approving the sale to Tortoise Media represents the best outcome for both the Observer and the Guardian.
“This is the start of a new chapter for the Observer, giving it access to much-needed investment, enabling it to build a long overdue digital presence and ensuring it has the top-level management support and focus necessary for it to flourish.
“Continued ownership by the Guardian Media Group has and would continue to constrain the Observer’s development as its overwhelming priority remains to support, invest and grow the Guardian as a leading, global, multimedia, liberal news organisation. The Observer, in this context, has found itself left behind in a fast-evolving digital news environment, confined to a small, loyal but shrinking Sunday print reading audience. Younger audiences have little awareness of the brand or, if truth be told, interest in a Sunday print news product. Tortoise’s plan is to reverse that trend and invest in giving the Observer a contemporary print, digital and audio platform with a significant capital injection.
“In addition they are committed to invest in more journalism, to expand and deepen their coverage across a wide range of fields. After years of slow retreat the Observer will be once more on the front foot. The alternative, inevitable decline tied to the print format under the status quo, is not a viable option. Through this new ownership structure, the Observer will receive the investment, the resources and the support it needs to maintain and enhance its digital identity across new and relevant platforms, enabling it to adapt and respond to changing reader habits.
“Questions have been raised in recent months as to whether there are better alternative homes for the Observer. For many months, we have carefully examined this with independent external advice, internal analysis and considered review of incoming expressions of interest. We have concluded that the Tortoise business plan and proposed investment in the Observer is by far the best way forward.
“To underline that, the Scott Trust has agreed to become one of Tortoise Media’s biggest shareholders, as well as taking a seat on both its commercial board and editorial boards. This will enshrine its continued involvement with the Observer, the opportunity to provide challenge and counsel to their management and reinforce the important principle of editorial independence.
“For the Guardian, it means we can focus on our long-term growth strategy, as we continue to expand globally and across digital and other media channels. We will continue to invest in investigations, leading reporting on the climate emergency and shining a light on under-reported issues. Now, with all our attention and finances behind one global news brand, the Guardian will be able to focus exclusively on delivering world-class multimedia journalism, round the clock, innovating and expanding its coverage for its growing global audience.
“At the Guardian, we believe that people want to understand the world they are in, and to create a better one. Ultimately, this renewed focus will help us to build hope and understanding through the clarity, integrity and imagination of our journalism.
“It is our shared conclusion that this transaction strengthens both titles and ultimately enhances the cause of a pluralism of sources of independent, liberal journalism in the UK. It gives the Observer the opportunity to flourish with fresh investment under new leadership, and compete unfettered in the digital age. For the Guardian it enables a clear, singular focus on building the leading independent progressive voice in world news.”
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