Trinity Mirror is contemplating abandoning the sales of the Racing Post and its Birmingham titles after the buyers for both submitted reduced offers at a time when the advertising market is improving.

The publisher is not the only media group reviewing its strategy in the light of the credit crunch. Emap, which has put its main businesses up for sale, is considering demerging into two parts if the credit crisis endures through November.

Trinity Mirror is expected to decide by the end of next week whether it will go ahead with its disposals, although progress has been hampered because Sir Ian Gibson, the chairman, is also the senior independent director of beleagured mortgage bank Northern Rock.

At one point, in the early stages of the auction, the Racing Post had been expected to attract a little over £200 million, but the offer price is thought to have dropped to around £175 million. The preferred bidder is a group of Irish investors, fronted by Allan Byrne, a former editor. Exponent and Barclays Private Equity are backing a management buyout of the Birmingham Post and Birmingham Mail. Trinity Mirror also believes that, while the price for newspapers has dipped amid wider pressure on business valuations, the advertising market is showing signs of reviving. Last week, Zenith Optimedia, the Publicis- owned media analyst, revised upwards its forecasts for 2008 growth in newspapers to 1.1 per cent from 0.6 per cent.

Trinity Mirror has already tried to manage expectations of a disappointing end to the process. The publisher of the Daily Mirror took a £90 million after-tax charge in August to reflect the probability that sale proceeds would fall short of the initial forecast. It said that it would receive about £450 millon gross from the sales of the Midlands titles, the Racing Post and including £92.9 million already achieved from title sales in London and the South East.

Emap, is taking indicative bids for its three divisions - consumer magazines, professional publishing and information, and radio, by October 1. However, the publisher is understood to have some concerns as to whether a sale at the right price is possible in the current market.

One source close to the company said that Emap realised that the current market conditions were out of its control and, if financing proved a problem, there were a number of options. These could include selling off just one or two businesses or demerging the group into two companies to be separately floated.

Emap’s business-to-business unit, valued at £1.3 billion, has attracted private equity groups, thought to include Apax, Candover, Kohlberg Kravis Roberts and Cinven. However, it is questionable whether they will have the same financial power as interested trade bidders, thought to include UBM, Reed Elsevier and Guardian Media Group.

The £400 million radio division has attracted a few private equity houses in the past month, including Vitruvian Partners, which recently lost out in the sale of Emap’s Irish radio stations, 3i and DLJ partners. Trade interest is understood to have come from GCap, UTV and Global Radio. Private equity has also expressed interest for the £700 million consumer magazines business, with the likes of Quadrangle and Veronis Suhler Stevenson running the slide rule over the division.

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