Alexander Lebedev's Evening Standard takeover: Dacre announces sale to staff

Alexander Lebedev's takeover of the London Evening Standard for a nominal sum, understood to be £1, has been confirmed today by parent company Daily Mail & General Trust, which said it remained "fully committed" to newspaper ownership.

The Evening Standard editor-in-chief, Paul Dacre, announced the sale to staff just before 10am today, at about the same time that DMGT announced the sale to the stock market.

Dacre told about 200 assembled staff in the Standard's Kensington newsroom: "It's a very sad day for the paper, it's a very sad day for the Rothermeres.

"We are very sorry that it leaked out, we had no control over that. Everyone's been working very hard and there's a lot of hope for the future of the Evening Standard."

Dacre paid tribute to the Standard's editor, Veronica Wadley. She is not believed to be in the office today, and is expected to leave the title and be replaced by Tatler editor Geordie Greig. Dacre then read out the formal statement on the sale issued by DMGT.

DMGT said its national newspaper division, Associated Newspapers, had sold 75.1% in its loss-making 50p evening newspaper for a "nominal sum" – widely thought to be £1 – to Evening Press Ltd, a company formed by Lebedev and his son Evgeny. Greig is a shareholder in Evening Press Ltd along with Justin Byam Shaw, a telecoms entrepreneur and adviser to Lebedev Holdings.

Evening Press will own 75.1% of a new company, Evening Standard Ltd. Associated will be a minority shareholder with 24.9%, but will not have a seat on its board or direct involvement in editorial policy. The Russian tycoon has said he wants to have an editorial board comprised of luminaries such as Mikhail Gorbachev, Lebedev's personal friend, and Tony Blair.

Alexander Lebedev, who has interests in Russia's National Reserve Bank and Aeroflot, will be the chairman of Evening Standard Ltd. Shaw will be deputy chairman and Evgeny Lebedev will be senior executive director.

The chairman of DMGT, Lord Rothermere, said that the company had been proud to have owned the 181-year-old paper, which has losses estimated as high as £25m annually.

"It has a long and distinguished history as one of the world's great city newspapers, based on outstanding journalism," Rothermere added. "I believe that Alexander Lebedev shares my commitment to newspapers and will continue to invest in the Evening Standard. I would like to take this opportunity to reiterate that DMGT remains fully committed to journalism and newspaper ownership."

Associated will continue to print and distribute the Standard for an "initial period", the length of which has not yet been undisclosed.

Talks between Lebedev and DMGT were first disclosed by MediaGuardian.co.uk earlier this month, as was Lebedev's firm intention to buy the paper last week.

Redundancies are expected at the paper and the sale is due to be completed next month.

The DMGT chief executive, Martin Morgan, said the deal was in the best interest of shareholders.

"The investment planned by Mr Lebedev secures the future of the paper," Morgan added. "DMGT will retain a 24.9% stake. We will continue to provide a range of support services to the paper but will not have a seat on the board or any involvement in its editorial policy. DMGT will benefit from the reduction in losses and will continue to invest in the development of our newspapers and other businesses."

Lebedev, a major shareholder, alongside Gorbachev, in the independent Russian newspaper Novaya Gazeta, said his family were delighted to be investing in the paper.

"We are strong supporters of a free and independent press and we greatly admire the Evening Standard as an iconic publication with its pedigree of fine journalism and commentary. We are committed to strengthening the newspaper's competitiveness and look forward to working with Associated," he added.

It is understood that Andrew Mullins, the Evening Standard managing director and former general manager at Times Media, will become chief executive of the Evening Standard. Simon Davies, the former Mail on Sunday ad director who was moved to the same role at the Evening Standard, is said to have been lined up as managing director.