David Montgomery's Local Worlds venture could soon be under the Office of Fair Trading’s microscope as it has said it is considering opening a full investigation into its deals.
Montgomery’s plan was to lead a “fight back” with the local press, which involved a complex deal with the Daily Mail & General Trust and Yattendon Group to put their regional papers into the Local World venture.
DMGT took a near 39 per cent stake in the venture, while farming-to-media group Yattendon now owns 21.3 per cent.
Montgomery also gained investment from rival newspaper business Trinity Mirror, which bought a 20 per cent stake, as well as other wealthy backers.
Local World brings 110 local newspapers together, but the OFT has raised questions over whether the deal will reduce competition amongst local newspapers.
The competition regulator has asked stakeholders to raise any objections by the end of the month, at which point it will weigh up whether to launch a full probe into the deals.
Steve Auckland, the chief executive, said it aimed to “create a flourishing and competitive business” and that it is “confident of providing full reassurance on any issues the regulator may raise”.