DAVID MONTGOMERY, the former Mirror Group chief executive, has overcome German opposition to unveil the £53 million takeover of Berliner Verlag, the German capital’s leading newspaper group.

Mr Montgomery bought the newspapers with Veronis Suhler Stevenson, an American venture capitalist specialising in media. His investment vehicle, the AIM-listed Mecom, will take a 15 per cent stake at a cost of £8 million, implying a £53 million bill for the whole.

The plan is to buy more European media businesses and yesterday Mr Montgomery described Berliner Verlag as “an excellent company” to which he and his partners “hope to be able to add further publishing assets” in the future.

However, the purchase of Verlag, owner of a small group of regional newspapers, has been controversial. There are concerns that Mr Montgomery could repeat the cost-cutting tactics he employed when running the Mirror titles.

There is also unhappiness in some parts of the media about the growing presence of venture capitalists in the market, interested only in making a quick profit.

Last week, Uwe Vokotter, Editor-in-Chief of the Berliner Zeitung, the broadsheet to be acquired by Mr Montgomery and his partners, attacked the expected purchase in an article and in a series of interviews. “I would have no objections if anybody bought us with a proper plan, someone who doesn’t want to pillage us,” he said.

There is also the concern that British tabloid standards will become the norm in Germany. That is why some of the most vehement opposition to Mr Montgomery has come from the Berliner Kurier, the only tabloid in the Berliner stable. It could become the first target in a Montgomery-led shake-up of the group.

Mr Montgomery insisted yesterday that he and his partners would be “proud custodians” of the Verlag titles, “committed to the highest journalistic standards, editorial integrity and good management”.

Mr Montgomery’s bid also survived the last-minute walk-out of 3i, which had been negotiating to be one of three purchasers until late last week. Its withdrawal left Veronis Suhler Stevenson as the principal backer. Berliner Verlag is being sold by Holzbrinck, a Stuttgart-based publisher, which has been forced to sell the business for regulatory reasons. It owns Der Tagesspiegel in the Berlin area.

No profit and loss information for Verlag was disclosed. Its flagship titles are Berliner Zeitung, a broadsheet with a circulation of 185,000, and the Kurier, the leading tabloid in East Berlin, which sells 121,000.

Yesterday German reporters were sent to research Mr Montgomery’s record at the Daily Mirror, which is regarded by many media experts in Berlin as anti-German.

'ROMMEL' WHO ENDED UP ON THE WRONG SIDE

WHEN David Montgomery was chief executive of the Mirror Group, between 1992 and 1998, the Ulsterman earned the nickname “Rommel” from journalists who disliked his leadership of the company behind the red-top tabloid.

Ironically, the veteran newspaper man is now heading a group that is to become the first foreign owner of a German newspaper.

Mr Montgomery took over at the Mirror Group in 1992 after the publisher was in crisis following the death at sea of Robert Maxwell. To ensure long-term survival, Mr Montgomery slashed costs to the point where employees felt that an unsympathetic moniker was justified.

The more obvious “Monty” was ruled out, the joke held, because Field Marshal Montgomery “was on our side”, leaving only a nickname based on the wartime leader’s German foe in Africa.

Mr Montgomery was forced out after a boardroom revolt in 1999 and moved into private equity, first as an adviser to 3i and more recently setting up Mecom, an AIM-listed vehicle with at least $100 million in backing.

His principal investor is Ochs-Ziff, a New York hedge fund, that also aided the Glazer family in its takeover of Manchester United.

Shares in Mecom, in which Mr Montgomery owns a 5.6 per cent stake, were unchanged yesterday at 49p.

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