Semiweekly Frequency The magazine business is showing its spirit: Ad revenue and page counts are up; circulation revenue is growing; there are more startups than ever; and the stock prices of magazine-centered companies are rising. Merger and acquisition activity is also brisk. About 75 industry executives attended Fulcrum Communications’ mid-June crash course in the ABCs of M&A. They learned, thanks to a study by investment banking
boutique DeSilva & Phillips, that buyers have become more sophisticated.
Premiere properties are fetching premium prices, and run-of-the-mill titles are going at discounts. There are still plenty of strategic buyers: publishers K-III, Cowles and Hachett are all looking to expand operations. But some of the biggest deals are going to financial buyers–such as Willis Stein and Hellman & Friedman–likely to resell at a higher price. The flow of deals, as these portfolio managers seek liquidity, may persist for a while.–Alan
Gottesman (westendal pobox.com) is principal of West End Consulting.
THE GOTTESMAN FILE
Nearly two magazines per week
were acquired in the year ending April 30.
Number of deals 78 89
Aggregate value $1,400 $1,520
Average value $17.9 $17.1
Deals in the Pipeline
Chilton Publications $447
Institutional Investor $150-200
Krames Communications $70-90
American Lawyer Media $60-80
* Excludes $2.1billion sale of Ziff-Davis to Softbank.
Source: DeSilva & Phillips Inc. Dollar values in millions
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