McGraw-Hill throwing in the towel on BusinessWeek?
For weeks, rumors have been brewing that McGraw-Hill Cos. was exploring a sale of BusinessWeek, its 80-year-old flagship title. Now those rumors have been seemingly confirmed in a report by Bloomberg, which says the publisher has hired Roger Altman's Evercore Partners to handle the sale.
It's no mystery why McGraw-Hill would want to be rid of BusinessWeek. Weekly print magazines have been hit especially hard by the downturn in ad spending that began last year, and BusinessWeek has taken one of the hardest hits of all. Its ad pages were down 30 percent year-over-year in the second quarter, and it's been estimated to have lost more than $20 million last year.
But who on earth would want to buy such a property -- especially in a comatose deal environment where credit remains tight? "There are so many issues around buying a weekly news magazine or business magazine that loses a tremendous amount of money that I think it would be hard to find an attractive buyer that would be willing to pay a price that would be considered reasonable by the sellers," says Reed Phillips, managing director of the media investment bank DeSilva & Phillips.
The timing may have less to do with perceived opportunity than with a change of heart by Harold McGraw III, chairman and CEO of McGraw-Hill. For years, McGraw, known as Terry, was said to be dead set against parting with BusinessWeek, the company's crown jewel and only real consumer-facing property. But according to Phillips, people close to McGraw have detected a softening of that stance recently. "They think his attitude's changed on that," he says.
I called McGraw to ask him about this directly but got a call back from a McGraw-Hill spokesman, who declined to comment on the sale rumors in any way.
With contributions from Jonathan Berr.