Posted by : Peter Wienand
| Date posted : 22/12/2011
BBC Magazines, the magazine publishing division of BBC Worldwide, has agreed to sell off Radio Times and other titles for £121m in a deal with Exponent Private Equity (“Exponent”).
The deal, announced in August 2011 and cleared by the OFT in October, will include a mix of sale, licensing and contract agreements under which Exponent will acquire in their entirety the TV listings magazine Radio Times (believed to be one of the most profitable) along with ten other titles deemed to be "less closely aligned to the BBC" such as Olive and Gardens Illustrated, as well as the right to publish BBC-branded titles under licensing and contract arrangements.
Exponent, the former owner of the Times Educational Supplement, has a diverse business portfolio which includes the online media jobs service Gorkana, vegetarian food manufacturer Quorn, the West End Ambassador Theatre Group, bed shop Dreams, the web publisher Magicalia and Radley handbags, and will be granted a 10-year licence to publish 18 BBC-branded titles, such as Gardeners' World and BBC Wildlife. While BBC Worldwide will not retain ownership of these 18 titles it will keep a "strong continuing editorial interest under licensing agreements". Best sellers Top Gear, Good Food, Lonely Planet and Easy Cook will be retained by the BBC but will be published by Exponent under a contract lasting five years.
Under the terms of the deal, the private equity firm will also acquire a 50% stake in Dovetail, BBC Magazines subscription fulfilment operation it runs as a joint venture with Dennis Publishing, and its share of Frontline, the distribution joint venture it runs with Bauer Media and Haymarket Publishing. It will also acquire Origin Publishing, in which BBC Magazines currently holds a 39% stake. BBC Worldwide has said that it intends to acquire the remaining stake to enable it to take outright control of the publisher, and then transfer ownership to Exponent.
Separately, BBC Worldwide has agreed the sale of its 50% shareholding in Worldwide Media, a magazine publishing joint venture in India, to Bennett, Coleman & Co Ltd, owner of The Times of India. Worldwide Media publishes titles including the Indian editions of Grazia, Hello!, Top Gear and Lonely Planet.
BBC Worldwide chief executive, John Smith commented "The deal...offers the best prospects for the magazines business to continue on this path of success, while BBC Worldwide pursues a strategy increasingly focused on international video and digital services. The consumer magazines market faces a number of challenges, and this transaction brings a focus and degree of investment that BBC Worldwide alone is unable to provide."
The majority of staff and operations will be transferred to the new company following completion of the deal.
If you require further information on anything covered in this briefing please contact Peter Wienand (peter.wienand@farrer.co.uk 020 3375 7254) or your usual contact at the firm on 020 3375 7000.
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