You're reading: Sources: American publisher sells leading Ukrainian media group to Poroshenko

Sources say that Ukrainian millionaire and former Foreign Minister Petro Poroshenko has purchased KP Media, a leading media group that publishes Korrespondent magazine and korrespondent.net.

American Jed Sunden reached the deal to sell his majority stake in KP Media to Poroshenko, who owns a large share of Ukraine’s confectionary business and Channel 5 television station. Sunden was reportedly seeking a purchase price from $15 million to $18 million.

Using profits from the Kyiv Post, Sunden went heavily into the Internet news business in the early 2000s, starting BigMir.net and korrespondent.net. He later launched Korrespondent magazine in and free publications, such as the subway handout 15 Minutes.

Poroshenko’s emergence as KP Media’s new owner would be greeted as a positive sign for independent journalism, since Channel 5 has been seen as one of the last television stations to offer viewers relatively independent journalism in the nation.

Increasingly, pressure is put on journalists to uncritically cover President Viktor Yanukovych’s administration.

Sunden started in Ukrainian publishing with the founding of the Kyiv Post in 1995.

He sold the newspaper, Ukraine’s first English-language newspaper, in 2009 to Mohammad Zahoor.

Since then, the Kyiv Post has become one of Ukraine’s top news sources with the July launch of www.kyivpost.ua, a Ukrainian and Russian language version put out by the same editorial staff.

The Kyiv Post broke the story on April 1 of KP Media’s sale.

Poroshenko has thus far not confirmed or denied whether he bought KP Media. Sunden, who has been seeking to sell his company for awhile, has had little to say about the transaction.

The Ukrainian media market is difficult. In this context, I do not rule out nor have I ever the appearance of new partners in any of my businesses, including KP Media. But in any situation that may arise, my key condition will be to preserve the basic editorial principles and my continued role in the company as a top manager.

– Jed Sunden

Sources told both the Kyiv Post and Ukrainska Pravda, another leading news source, that media magnate Boris Lozhkin – the majority owner of Ukrainian Media Holding — could play a role in managing KP Media’s assets and could end up with an ownership stake as well.

According to Ukrainska Pravda, Ukraine’s richest businessman Rinat Akhmetov had been in the bidding for KP Media.

But Poroshenko emerged, according to Ukrainska Pravda, and convinced Sunden to sell to him instead in of to another owner who would only accelerate the concentration of media ownership in the nation.

Akhmetov, a longtime backer of President Viktor Yanukovych, owns leading television channels, newspapers and Internet portals. He and other Yanukovych backers have a dominant position on Ukraine’s media market, foremost the influential television market.
Other top media owners are Viktor Pinchuk, the billionaire son-in-law of former President Leonid Kuchma; billionaire Igor Kolomoisky; and Security Service of Ukraine chief Valeriy Koroshkovsky.

According to Ukrainska Pravda, Poroshenko told Sunden: “Jed, if you are selling, then sell to me, because we cannot allow concentration of media in the hands of one political team.”
Ahead of the 2004 Orange Revolution, the revolt to overturn a presidential election rigged for Yanukovych, Poroshenko invested heavily into Channel 5 television channel. The journalists there stood out as among the few on television who reported about the revolution fairly.

In a statement issued on April 5, Sunden did not clearly confirm or deny that a sale was in the works, but stressed that he will retain a top management role at KP Media and will continue preserving the editorial independence of the group’s publications.

“The Ukrainian media market is difficult. In this context, I do not rule out nor have I ever the appearance of new partners in any of my businesses, including KP Media,” Sunden said. “But in any situation that may arise, my key condition will be to preserve the basic editorial principles and my continued role in the company as a top manager. Even if a new partner arrives, I will personally remain the guarantor of free and independent journalism.”

Using profits from the Kyiv Post, Sunden went heavily into the Internet news business in the early 2000s, starting BigMir.net and korrespondent.net. He later launched Korrespondent magazine in and free publications, such as the subway handout 15 Minutes.

But Sunden and other media owners got hit hard by the 2008 global economic crisis, which saw advertising plummet. Consequently, Sunden in 2009 sold the Kyiv Post to Zahoor, a British national who was born in Pakistan. Zahoor owns the ISTIL Group. Sunden also was forced by the advertising downturn to sell or close other publications, including 15 Minutes, Pink magazine, Pani and Novynar.

A minority stake in KP Media is owned by portfolio investors.