Rautakirja's Lehtipiste wholesale newspaper and magazine sales business has signed a draft agreement with four leading Latvian publishing houses covering cooperation to market and distribute newsstand copies of newspapers and magazines in Latvia.
Rautakirja will buy the majority of the shares of Press Agency Santa, currently owned by Latvia's four leading publishers: AS Diena, AS Preses Nams, Zurnals Santa Ltd., and Petits Publishing House. After the reorganisation, Rautakirja’s holding in the new company will be 52%, while the Latvian publishers will each own 12%.
On start-up, the company will have a market share of slightly over half of the total Latvian press distribution market of more than FIM 200 million. In all, there are some 2,500 outlets in Latvia selling newspapers and magazines, with roughly 70% of these located in the capital, Riga, and the surrounding area.
The new company's net sales during its first year of operations are estimated to be in the order of FIM 75 million, and the company will initially employ some 40 people.
Rautakirja already has a presence on the Latvian retail market through its 35% share of Narvesen Baltija, a company owning 15 convenience store outlets, a number of cafés and cosmetics stores, and most recently the 450 kiosks of the Preses Apvieniba chain. In addition, Rautakirja is also involved in cinema and film distribution operations in Latvia, and is currently engaged with the Stockmann department store chain in building a department store and multiplex cinema in Riga.
In Estonia, Rautakirja is involved in kiosks, press distribution, bookshops, and cinemas, and owns the sports betting company, Megapanus.
Rautakirja recorded net sales of FIM 138 million in the Baltic states in 2000 (total: FIM 3,833 million). Around 14% of Rautakirja's personnel are employed in Estonia and Latvia.