Welcome!
2017-03-16 05:07:02
Us Weekly Is Sold to National Enquirer Publisher

Us Weekly, a celebrity magazine that has long been a staple at checkout counters, is changing hands.

On Wednesday, American Media Inc., publisher of The National Enquirer and Radar Online, announced that it had reached an agreement to acquire Us Weekly from Wenner Media, which has owned it since 1985. Terms of the agreement were not disclosed, but two people who were briefed on the deal but requested anonymity because the terms were not public said the price was $100 million.

“We are excited to bring one of the most distinctive and powerful media brands to AMI and are looking forward to continuing its great editorial standards its loyal and growing audience expects,” David J. Pecker, American Media’s chairman and chief executive, said in a statement.

The acquisition of Us Weekly will give American Media a younger, more affluent audience, and a larger digital presence. It will also increase American Media’s heft in celebrity gossip — along with The National Enquirer and Radar Online, the company publishes the supermarket staples Star and OK!

For Wenner Media, which also publishes Rolling Stone and Men’s Journal, the sale of Us Weekly represents a further paring of assets. Last year, it sold a 49 percent stake in Rolling Stone to BandLab Technologies, a Singapore-based music technology company led by Meng Ru Kuok, the son of an Asian business magnate.

“I’m sad to say goodbye to those people and to a great brand — it’s done wonders for us and our family,” Gus Wenner, the chief digital officer at Wenner and the son of the company’s founder, Jann S. Wenner, said in an interview. “But it’s also an exciting day for us, and I’m very excited to focus on the next chapter of Wenner Media and on the brands that we have where we see enormous growth potential.”

Like other celebrity publications, Us Weekly has struggled in the digital age. Once a powerhouse whose editors included Janice Min and Bonnie Fuller, the magazine had a roughly 30 percent decline in newsstand sales in the second half of 2016 from the same period a year earlier, according to publisher’s statements filed with the Alliance for Audited Media.

Us magazine was founded in 1977 by The New York Times Company in the vein of Time Inc.’s People magazine, but the company sold Us three years later. “Never acquire a company that you’re embarrassed to tell your mother about. Or start a publication, in this case,” Arthur O. Sulzberger, the newspaper company’s previous publisher, once said about Us. “It really isn’t our line of work, and we weren’t very good at it.”

Wenner Media bought Us in 1985 and turned it into a weekly from a monthly in 2000 to compete more directly with People and Entertainment Weekly, another Time Inc. magazine.

Us had a rough start as a weekly, however, and in 2001, Wenner sold a 50 percent stake in the magazine to the Walt Disney Company for about $40 million. Five years later, Wenner Media borrowed $300 million to buy the stake back, saddling itself with debt that has required significant annual payments.

Gus Wenner said that the proceeds from the Us Weekly sale would go in part toward repaying the company’s remaining debt. (Wenner used $25 million from the $40 million Rolling Stone deal last year for a special payment on the loan, according to credit reports.)

The sale of Us Weekly is the latest sign of Wenner Media’s struggles. Rolling Stone lost a defamation lawsuit in November over a widely condemned 2014 article about allegations of a gang rape at the University of Virginia. The magazine still faces another lawsuit related to the article.

Without Us Weekly and its 110 staff members, Wenner Media will be significantly smaller. The magazine brought in 65 percent of the $330 million that Wenner Media generated in revenue for the year that ended in June, according to a report in October from Moody’s Investor Service. Rolling Stone produced 27 percent of the company’s revenue, and Men’s Journal contributed 8 percent.

By selling Us Weekly, Wenner Media has further shifted its business away from print. Last year, it introduced Glixel, a stand-alone site devoted to games, and the company has made a big effort to increase its digital advertising revenue to make up for declines on the print side.