In what has been one of the worst-kept secrets in media (apart from the bidders circling Time Inc.), Wenner Media has at last found a buyer for Us Weekly. American Media Inc. today closed a deal for the celebrity glossy, that, according to insiders, was for a hefty $100 million.
Us Weekly is joining a well-established stable of gossip titles at AMI that includes National Enquirer, Radar Online and Star. AMI had been rumored for weeks as a potential buyer for the weekly, but the sale seemed to suddenly stall and Tronc emerged as a possible buyer. A source said a deal between Wenner and Tronc fell through late last week and Wenner reignited talks with AMI on Friday evening. Lawyers worked over the weekend to close the deal.
“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,” AMI chief executive officer and chairman David Pecker said. “The extraordinary growth of Us Weekly as a multimedia leader for advertisers under Victoria Lasdon Rose’s leadership underscores the vitality of the brand to deliver creative and engaging marketing opportunities with its star-studded events.”
“We are enormously proud of the evolution and tremendous accomplishments of Us Weekly, a brand that has continually defined celebrity news,” Gus Wenner, head of digital of Wenner Media, said. “We know that AMI will provide Us Weekly with exciting opportunities and we look forward to following their continued success.”
Wenner Media, which owns Rolling Stone and Men’s Journal, acquired Us Weekly in 1985 from The New York Times Co. Wenner Media partnered with The Walt Disney Co. on the title in 2001, and bought it back in 2006 for a reported $300 million. The price at the time showed the cash cows that celebrity weeklies had become and Us Weekly regularly rivaled longtime frontrunner People in circulation terms.
Since then, though, times have been tough for the magazine industry as a whole, and for Wenner Media in particular, which recently sold a 49 percent stake in Rolling Stone to BandLab Technologies, a Singapore-based social media and retail company. Sources say that Wenner has been strapped for cash after buying back Us Weekly, combined with the legal fallout from the controversial “Rape on Campus” story in Rolling Stone. With loan covenants due, Wenner is said to have shopped around sibling publication Men’s Journal over a year ago to Time Inc. and Rodale.
Returning to Us Weekly, insiders say that Wenner also shopped the title to Hearst Magazines recently.
WWD reached out to AMI regarding cuts at Us Weekly following the sale, but a representative for the company declined to comment. Us Weekly has roughly 100 employees. According to sources, there will likely be layoffs following the sale as AMI has a centralized news structure and a consolidated back office.
Methuselah Advisors advised Wenner Media on the sale, and Skadden, Arps, Slate, Meagher & Flom LLP is its legal adviser. Cole Schotz P.C. is legal adviser to AMI.