Independent Media is restructuring several business units as “part of its ongoing efforts to address the challenges within the business and broader media environment”.
“After a thorough evaluation, the company has determined that further restructuring is critical to its long-term sustainability,” it said in a statement.
The statement put “the looming threat of a potential closure of banking facilities, Independent Newspapers’ reliance on advertising and circulation revenue as well as its lack of access to loans or banking facilities as reasons for the restructuring, saying this had put the business “in a precarious financial position”.
“The risk associated with losing banking support, particularly given the company’s cash-based operations, poses an existential threat. The restructuring is therefore essential to securing the company’s future and mitigating these banking risks,” it said.
Executive chairman of Independent Media, Dr Iqbal Survé, said the cost of running print titles had become unsustainable for Independent Media, Sekunjalo and the Survé family, “who have personally bolstered the publishing company over the last few years”.
Rising operational costs — especially those related to paper and print, account for 60% of the company’s expenses.
“Print media has been an iconic pillar of our company for decades, but the current business model is no longer sustainable in a world where digital platforms offer far greater reach and engagement opportunities,” Surve said.
While every effort would be made to mitigate the effects of the restructuring, not all employees would transition into the expanding digital division, Surve added, saying, “We will assist with transitions wherever possible.”
