Metro franchise in Moscow

Metro International has formed a joint venture with ESN Group to acquire a stake in free daily Gazeta Metro, the most read free newspaper in Moscow. (see also previous post.)

Gazeta Metro was started in 1997 as a partnership between Sistema Group, the Moscow city government and Moscow Metropolitan (the Moscow subway owner and operator).

Gazeta Metro is distributed in the Moscow subway and with 400,000 daily readers is the third most read newspaper in the city.

The initial stake of the new joint venture will be 0.81%, with Metro International having the option to acquire additional shares in Gazeta Metro. ESN Group, through a coupled option, has the right to acquire an equity stake in Metro St. Petersburg, a Metro International franchisee since 2005.

Gazeta Metro will be re-launched and rebranded in 2009 as a ‘green’ Metro. Synergies between Gazeta Metro and Metro St. Petersburg will be exploited. These synergies include content sharing and advertising sales packages.

Per Mikael Jensen, Metro International’s President and CEO commented in the press release:

The very pleasing development of Metro in St. Petersburg over the last three and a half years has made us receptive towards expanding further in Russia. We have for many years kept a watchful eye on the media sector in Moscow, waiting for the right opportunity. With ESN Group as our partner as well as subway distribution rights we hope over time to establish Metro in Moscow as a leading print medium. The Moscow advertising market is much larger than that of St. Petersburg and therefore this joint venture has significant promise.

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