According to City broker Numis Securities, Mecom will be an "activist" investor that "will seek strategic stakebuilding opportunities, followed by a review of operations by existing management or a change of management".
Montgomery's new investment vehicle floated on the Alternative Investment Market (AIM) in April, raising £45m in the process. Now that he has clinched a £100m funding agreement with US Hedge Fund Och-Ziff, tongues are wagging about what the former Mirror Group boss might be up to next.
It is thought that Montgomery – who is working with the venture capitalist 3i – is capable of launching a bid worth more than £1bn. Indeed, one previous report said that Montgomery would like to buy the Daily Mirror, while The Independent and the Financial Times have also been tipped as potential targets.
Numis claims "Mecom will focus on investing in media companies which are suffering from poor relative profitability", adding that the outfit has "10 live targets at any one time".
Most media bankers believe Mecom will focus on bidding for newspapers. "Montgomery's heart and soul is in newspapers,"
said one source familiar with the situation. Indeed, Montgomery is understood to have been active in bids for newspapers in the past, including: The Daily Telegraph, The Belfast Telegraph, Frankfurter Rundschau, Sächsische Zeitung, The Herald in Glasgow, the Express and SocPresse regionals in Belgium and France.
Most media bankers believe he will continue to cast his net wide, targeting local newspapers and European newspaper assets.
Indeed, one source said Montgomery was rumoured to be looking at newspapers as far afield as Eastern Europe.
However, other City sources questioned whether Montgomery will be able to get his plan off the ground, because newspaper publishing is a mature market with few assets readily available.
"I don't know of any newspaper assets in the UK that are up for sale," quipped a senior newspaper source.
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