Sekunjalo Group Chief Executive Officer (CEO) Lucien Jacobs. Sekunjalo Group's strategic pivot towards digital publishing marks a significant shift in South Africa's media landscape, ending financial support for loss-making operations and focusing on sustainable growth.
Image: Ayanda Ndamane / Independent Newspapers
Sekunjalo Group has announced a significant strategic shift in its media investments, unveiling plans for major expansion in digital publishing while signalling the end of its long-standing financial support for loss-making operations within Independent Media.
In a communication to employees, Sekunjalo Group Chief Executive Officer Lucien Jacobs outlined both positive and challenging developments affecting the group's media portfolio.
On the positive front, Jacobs confirmed that Independent Online (IOL) had secured substantial funding from European and American partners to accelerate its digital growth strategy. According to Jacobs, the investment is expected to expand IOL's national footprint and create hundreds of jobs across the journalism, content production and digital media sectors.
"Digital is the future," Jacobs said, congratulating IOL CEO Viasen Soobramoney and his team on securing the investment.
The announcement follows IOL's recent plans to expand its editorial operations and strengthen its digital publishing infrastructure as part of a broader national growth strategy. Jacobs also revealed plans to launch a new national newspaper, The National, in partnership with strategic external investors. The publication, he said, aims to position itself among leading international news brands.
"Our ambition is to build a world-class publication comparable to leading international titles such as The New York Times, The Washington Post and The Guardian," Jacobs said.
The new venture is expected to recruit journalists, editors, videographers, photographers, circulation specialists, marketers and other media professionals as it builds a portfolio spanning daily, business, weekend, regional and vernacular publications.
However, alongside the expansion plans, Jacobs announced significant changes to Sekunjalo's relationship with Independent Media. He said that the licensing agreement for Sekunjalo-owned mastheads had ended. A future decision will determine whether those mastheads will be licensed to third parties or incorporated into new publishing ventures. Jacobs further indicated that Independent Media had been informed it could no longer rely on continued shareholder funding from Sekunjalo Group.
According to Jacobs, Sekunjalo's leadership has adopted a more commercially driven approach to investment decisions.
"The younger and new generation of leadership, including shareholders, has a clear mandate to apply commercial principles and ensure that businesses within the Sekunjalo Group are financially viable," he said.
Jacobs argued that while the original acquisition funding used to purchase Independent Newspapers from its Irish owners in 2013 involved contributions from several partners, Sekunjalo had subsequently borne the majority of the financial burden in supporting ongoing operations. He said Sekunjalo had invested more than R2 billion into the business since 2013, excluding interest and associated funding costs. According to Jacobs, the group recently injected an additional R20 million into the operation despite its decision to discontinue long-term support for ongoing losses.
He also confirmed that the company communicated its position to other stakeholders, including the Public Investment Corporation (PIC) and other shareholders.
"We remain willing in good faith to engage with our stakeholders," Jacobs said. "However, the era of one shareholder carrying the financial burden for all others has come to an end."
Despite the challenges facing traditional print media globally, Jacobs said Sekunjalo remains committed to the future of journalism in South Africa. He argued that the country's media industry requires commercially sustainable business models capable of supporting independent journalism while remaining financially viable.
Looking ahead, Jacobs said the group had already engaged with potential investors from Europe and the United States who had expressed interest in participating in future media ventures, subject to the development of sustainable business plans and growth strategies.
"Our focus now is on growth, innovation, job creation and building media businesses that can thrive for generations to come," Jacobs said.
"We are moving forward, we are investing in the future, and we will do so on a commercially sustainable basis."
The announcement marks one of the most significant developments in South Africa's media landscape in recent years and signals a new chapter for Sekunjalo's media interests as the group seeks to reposition itself around digital growth, strategic partnerships and commercially sustainable journalism.
IOL