NEW YORK — Russell Denson has finally unveiled his master plan for YM: Get rid of it.
The Gruner + Jahr chief executive said Wednesday he has hired media investment bank AdMedia Partners to explore a sale of the star-crossed teen title.
“We wanted to focus our resources on what we believed our core titles are,” Denson said. “Our mission in life is to do everything we do better, but YM needed more work than that.”
The announcement reignited speculation that Denson, who was hired in May to replace the ousted Dan Brewster, is under orders from German corporate parent Bertelsmann to sell off G+J’s U.S. assets, which include such titles as Parents and Family Circle. Denson, however, insisted that is not the case.
“No other magazines are for sale, and the company is not for sale,” he said.
The pool of companies considered potential bidders for YM is limited, with the likeliest being Hachette Filipacchi Media, which owns Elle Girl, and tabloid publisher American Media, which is looking to expand its roster of consumer titles. Even after reducing its rate base to 1.5 million from 2.2 million last fall, YM remains “a big-circulation book, so a small, independent publisher probably can’t afford to play in that kind of arena,” said magazine consultant Martin Walker of Walker Communications.
Moreover, he said, YM’s checkered past — it was one of several G+J titles caught inflating its circulation numbers — will further limit its appeal. “It’s damaged merchandise,” said Walker. “My guess is, because it’s such a crowded field, someone is going to buy it basically because of the subscriber file and blend it into the publication that they have.”
It’s unclear how much money YM might fetch in an auction. Six YM staffers were among the 60 G+J employees let go in a round of layoffs earlier this month, along with four members of a business unit that served YM and several other titles. A source close to G+J said the title lost more money last year than any of the company’s six other magazines, not all of which were in the red. Even assuming that what remains of YM’s circulation file is relatively healthy, it’s unlikely the sale price will come anywhere near the $182.4 million that Hearst Magazines paid to acquire Seventeen from Primedia last year.