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. Last Updated: 07/27/2016

Powerful Publishers Merge

The popular daily newspaper Komsomolskaya Pravda and the Segodnya Group announced a complicated merger Tuesday, forming a publishing group with sales over $100 million.

The reorganization involves merging and swapping shares and solidifies a web of cross-shareholdings that has developed since a group of entrepreneurial Komsomolskaya Pravda journalists formed the Segodnya Group several years ago.

"Today we claim the role of the largest publishing house in Russia and the CIS," said Vladimir Shkulyov, general director of the newly merged holding company, which will be called the Komsomolskaya Pravda-Segodnya Group Publishing House.

The group claims that its flagship Komsomolskaya Pravda daily has a weekday circulation of 1.25 million copies, rising to 2.46 million copies on Fridays.

The group also includes the newspaper's regional advertising supplements Va-Bank and Ekstra-KP; a color tabloid called Ekspress-Gazeta; the Antenna television guide; Aida! magazine; and several local newspapers and special-interest magazines. The group says it produces 76 titles per month with a combined circulation of 56.5 million copies.

One of the company's biggest assets is a system of distribution companies in many regions of Russia and the Commonwealth of Independent States.

Managers said Tuesday that by the end of 1997 they expect to reach total sales of 650 billion rubles (over $110 million) and make a profit of 67 billion rubles (about $11.4 million).

Andrei Pankratov, first deputy general director of the new holding, said that the reorganization became necessary in the face of growing competition in the Russian media industry.

The reorganization, which will not immediately affect the company's publications, is aimed at improving management of the group's far-flung empire of publications and distribution companies.

Shkulyov said the shares of the new giant publishing house belong to a "narrow group of physical persons," and no major bank is playing a crucial role.

The formal merger between Komsomolskaya Pravda and the Segodnya Group was made possible after the Segodnya Group obtained a controlling stake in the daily earlier this year. Uneximbank also holds a 20 percent stake in the paper.

The Segodnya Group is not related to the Segodnya newspaper, published by Vladimir Gusinsky's Media MOST holding company.