DURBAN- Novus Holdings might lose an important contract to print newspapers for Media24 according to reports.
The company, according to its website, is a leader in commercial printing - printing newspapers for Media 24, Caxton and other smaller independent houses.
The loss of the contract will see Novus facing yet another grim year but with the loss of the crucial contract but reports suggest that the move could save Media24 as much as R200 million.
Caxton looks set to pick up Media24's Gauteng newspapers and its magazines that based in the Cape. In the KwaZulu-Natal province, a Durban-based printer will pick up the province publications.
It is important to note that Novus Holdings, who was previously part of the Naspers Group, is now being axed by Media24 which is a Naspers Group subsidiary.
The decision by media company Media 24 to move from Novus to Caxton, a long-term, contentious competitor of Novus, will be announced in late February. This is also the time that the talks between Novus and Media 24 are expected to come to an end.
The new plans will come in to effect on April 1, 2018.
On Thursday, the printing company confirmed that they were evaluating the future of its Paarl Coldset plant in Pietermaritzburg. The Pietermaritzburg plant is responsible for the printing Media24's newspapers and magazine.
Terry Moolman, the Caxton group CEO said on Thursday that this group was in negotiations with media company Media 24.
Piet Greyling, The Executive Director, said that the final result will be known in March. Media24's chance to renegotiate the printing of the contract of Novus which has been in place for 17 years, since 2001, was set off by the death of Lambert Retief last year January.
Retief had been the CEO of Novus and a big force in building up the company and had a 20% stake until 2015, when the company was listed.
He had also reportedly been influential in securing the deal with Media24 which held the remaining 80% of Novus.
In 2014, Media24 was thought to be the obvious buyer when Retief announced that he wanted to sell his stake.
However. the move was blocked by Caxton who laid a complaint with the competition authorities that buy was the same to change of control.
For Retief to cash in his percentage, Novus had to be listed and Media24 was forced to decrease its holding to 19%. It was then entitled to cancel the contract on six months' notice after the death of Retief.
Novus is Caxton's legal threat to the awarding of the Department of Basic Education’s profitable deal to print 60 million books. The contract is said to be valued at up to R3 billion over three years.
Caxton wants the Constitutional Court to announce the tender award null and set it aside.
The company wants the court to order Novus to repay all profits earned on the "lawful contract"
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- BUSINESS REPORT ONLINE