THE owner of the Independent and Independent on Sunday today suggested a deal to sell the newspapers is imminent as it reported losses of 31.4 million euros (£28.1 million).

Dublin-based Independent News & Media (INM) said talks are ongoing with former KGB agent and Evening Standard owner Alexander Lebedev and that an announcement would be made "very shortly".

The group posted results showing it remained firmly in the red in 2009 after turnover declined by 14.9%, with a 33% plunge in advertising revenues at the Independent and Independent on Sunday.

But it said the figures reflected a "comparatively resilient performance" after a torrid year for the media industry as it battled against a deep slump in advertising revenues.

It said profitability on an underlying basis had stabilised in the second half - a trend that has continued into 2010, with some markets showing a welcome rise in earnings.

INM first revealed it was in advanced talks with Mr Lebedev over a possible sale of its UK national newspapers last December.

The Russian oligarch already owns London’s Evening Standard after snapping up the paper in January of last year for a nominal fee.

The INM titles already share the same offices as the London paper after relocating to share space with the Standard’s minority owner Associated Newspapers in Kensington, west London.

INM said major cost cutting at its two national UK titles saved more than #20 million last year and helped narrow operating losses within the division.

It said the Independent remained "an integral part of the UK quality newspaper market", claiming a UK readership of 671,000.

In more recent trading across the wider group, INM posted a 5.8% rise in turnover and a 7.8% rise in advertising revenues in the year so far to March 19, although it said this was boosted by favourable currency exchange rates.

"While it is still very early in the year, if these current trends continue, we would target an improvement in operating profit for 2010," the group said.

It added: "In the immediate term, vigilant cost management and further debt reduction will remain priorities and, as economies recover, we will focus on converting our leading market share positions into revenue and operating profit growth."

In 2009, cost efficiencies helped reduce pre-tax losses by nearly half, from 211.7 million euros (£189.1 million) a year earlier.This time a year ago, INM was warning of doubts over its ability to continue as a going concern as it struggled under mounting debts and due repayments.

However, the group - which owns more than 200 newspaper and magazine titles worldwide - successfully completed a debt refinancing last December and said it had reduced net debts significantly over 2009, down by 367 million euros (£327.7 million).

It is understood that INM’s recent debt restructuring paved the way for the group to rekindle talks with Mr Lebedev that had been put on hold last summer as INM focused on its debt woes.

Shares in INM rose 3% today.