Pecker’s AMI seen as the lead suitor for Us
THE word in the industry is that David Pecker’s American Media Inc., owner of the National Enquirer and Star Magazine, has emerged as the lead suitor to buy Us Weekly from Jann Wenner’s Wenner Media.
An AMI spokesman reached Tuesday said, “AMI does not comment on rumors.”
Wenner Media is also staying mum, responding to Media Ink with a curt, “Wenner Media is not commenting.”
Wenner probably prefers to sell to anyone but Pecker, but may have to take AMI’s money if it is the best deal around, since Wenner Media still carries nearly $60 million in debt, one source noted.
Several digital players are said to be kicking the tires as well.
A sale would mean overcoming a serious amount of bad blood between the two media moguls — dating back to 2003, when AMI raided prized editor Bonnie Fuller from Us for a remake of Star Magazine that would compete with Wenner’s celebrity title.
In response, Wenner ended his link with AMI’s distribution arm, shrinking Pecker’s profits.
But the money attached to an Us Weekly sale could buy a lot of forgiveness.
Wenner might not have that many options, especially since the most logical suitors from the print world — Time Inc., which published People, and Bauer Publishing, which owns Life & Style — are hamstrung.
The prospect of a sale to AMI has insiders at Us Weekly up in arms — and some in tears — even though nothing official has been revealed.
The only way for a strategic partner to make the plan work is to promise its investors and/or lenders that it can make massive cuts — which probably means cutting payroll from Editor-inChief Michael Steele’s editorial team as well as most of the back-shop operations.
Us Weekly rang up estimated revenue of about $217 million in the year ended June 30. Profit was about $15 million.
While Wenner has always been left of center politically, AMI’s flagship National Enquirer was one of the few news organs in the country — aside from Breitbart News — to openly support Donald Trump for president.
“The bigger question for us is we didn’t sign up to make up stories about Hillary Clinton’s health or
Kate Middleton having twins or Jen Aniston having her eighth baby,” said one worried Wenner insider. “We have credibility in the market — and if we are merged with Star/OK! and the Enquirer, we will be a laughingstock.”
TheStreet in focus
There could be a roll-up of two struggling digital media operations in the near future — if one investor in TheStreet.com and Salon Media has his way.
Now that the activist investor, Spear Point, has finally closed the deal to seize control of the board of foundering Salon Media, it is resetting its sights on Jim Cramer’s TheStreet.
“We do think there is room for consolidation, especially in the smaller end of the market,” said Ron Bienv
enu, managing partner of New Orleans-based Spear Point, which has less than $100 million under management.
“TheStreet, I think, lacks compelling vision,” said Bienvenu. He holds just under 5 percent of the stock of TheStreet and is still smarting that his pick for a board seat, Lex Fenwick, a former top executive at Bloomberg and Dow Jones, last spring was disqualified on a technicality from a seat on the company’s board.
“We’re very frustrated,” said Bienvenu. “We don’t like it when the chairman runs the company like a personal fiefdom.”
Salon, meanwhile, held its first board meeting on Tuesday following a move by Spear Point on Friday to inject about $1 million into the struggling digital company to gain control of its board.
The equity infusion gave it 805,824 shares of preferredd stock that are expected to be converted into 29 percent of common stock.
In addition to Bienvenu and Spear Point colleague
Trevor Colhoun, the company added Dick MacWilliams, an ally from Vista Capital, as an outside director and chairman of the new board. Interestingly, MacWilliams had sold Broadex to TheStreet two years ago and it is one of TheStreet’s best performing divisions. John Warnock, the 76-year-old cofounder of Adobe Systems, stepped down from the Salon board. William Hambrecht, the octogenarian Silicon Valley investor who had 30 percent of the Salon stock, was reported to be staying on board. George Hirsch, a former publisher of Runner’s World, is also stepping down from the Salon board. Jordan Hoffner, who was installed as CEO of Salon Media in May, now has a seat on the board of Salon and is an investor as well. “Jordan is driving the ship for us and we like his vision,” said Bienvenu. Larry Kramer, chairman of TheStreet, said, “We announced a year ago a plan to clean up TheStreet and deal with a number of issues. We’re happy with where we’re going.” Regarding a possible fight with Spear Point, he said, “We always listen to our shareholders, including Ron and the people at Spear Point. We’re watching Salon with interest.” Neither of the digital pioneers hatched during the mid-1990s is performing particularly well. TheStreet hit a new 52-week low of 77 cents on Tuesday before rebounding to close at 82 cents a share, down 2.3 percent. Salon closed unchanged at 20 cents a share.