Newspaper group Trinity Mirror, which owns more than 180 titles nationwide, including Daily Mirror and Sunday Mirror, is set to acquire Local World for about £187.4m (€259.1m, $286.6m). The deal will strengthen the group's position as UK's biggest regional newspaper publisher and will help Trinity save between £10m and £12m after the second full year of ownership.

Trinity had previously owned about 20% share in Local World and will now pay £154.4m in cash for the remaining stake. The deal will be financed through debt, cash and a share issue.

At this price the enterprise value of Local World stands at £220m. This is roughly five times its last year's adjusted earnings before interest, taxation, depreciation and amortisation of £42m and about double its value in 2012, when it was created by merging various regional newspaper assets of Daily Mail, General Trust and Iliffe News & Media.

While DMGT that owns 38.7% stake in Local World will receive £73m in cash, Local World's chief executive, David Montgomery will receive nearly £10m in exchange for his 5% stake. He will leave the company post the deal.

As part of the deal, Trinity will sell seven titles of Local World for £15.8m in cash to Edward Richard Iliffe, owner of Iliffe parent Yattendon Group, which holds a 21.3% stake in Local World.

Trinity Mirror's chief executive, Simon Fox said, "Scale matters. We'll have a digital network of some 120m monthly unique users." The deal marks the consolidation phase in this industry as publishers seek to attract advertisers and reduce costs in response to falling revenues.

Ian Whittaker, an analyst with Liberum, said: "One of the big medium to longer-term positives could be in the programmatic [advertising] sphere, where the now bigger scale of advertising volume sold could be a big plus."

In March this year, it was reported that Trinity was mulling a bid for certain assets belonging to newspaper group Northern & Shell. Fox declined to comment on the Northen & Shell deal, but said it had a "strong balance sheet" that could facilitate more acquisitions.

Post the deal, Rachel Addison, the current chief operating officer of Local World will move up the ranks to the role of managing director and would report into Fox.