Everything's a dollar, including BusinessWeek
That's how much OpenGate Capital paid when it boughtTV Guide from Macrovision last year. It's how much some analysts think The New York Times Co. will fetch for the Boston Globe. Now, it's being floated as the likely sale price for BusinessWeek, which McGraw-Hill said yesterday it it may unload. Paid Content and the Financial Timesagree: This 80-year-old business title with a circulation of 900,000 can be yours for a buck.
Of course, a dollar isn't really a dollar. For starters, whoever buys BusinessWeek is agreeing to absorb its annual losses, which are estimated to range from $10 million to $75 million on annual revenues of around $130 million. The company's subscription liabilities are another unknown, and would likely be part of the package.
No wonder potential buyers are keeping their distance. According to BusinessWeek's own Jon Fine, Bloomberg has already taken a look and passed. Meanwhile, News Corp., which owns The Wall Street Journal and Barron's, told FT it's not interested. That narrows the field considerably. Paid Content speculates that DailyFinance parent AOL could be a good fit. I have no knowledge of any such discussions.
Assuming you have a symbolic dollar to spend on an iconic magazine, what's the best use of it? TV Guide has a far larger circulation than BusinessWeek, with a rate base (or guaranteed minimum circulation) of 3.2 million at the time of the OpenGate acquisition. That comes out to 0.00003125 cents per reader, versus 0.00011 cents for BusinessWeek. On the other hand, BusinessWeek's 2008 ad revenue was $236.1 million, versus TV Guide's $196.4 million. So, on that measure, BusinessWeek offers slightly more bang for the buck.