Forbes family cedes control

The Forbes family, an emblem of American wealth and pioneer of business journalism, is giving up control over the media empire it cultivated for almost a century by selling a majority stake to a Hong Kong-based group.

The transaction valued ForbesMediaLLC at US$475million, said a person with knowledge of the matter, who asked not to be identified because the terms are private. The agreement, announced Friday, will hand over Forbes magazine and its widely followed ranking of the world’s richest people to a collection of investors led by Integrated Asset Management (Asia) Ltd., founded by investor Tak Cheung Yam, Forbes said.

“The investor group will provide capital, as well as financial and operational expertise, and intends to leverage its international relationships to strategically enlarge Forbes Media’s reach on a global scale,” Forbes said.

Steve Forbes, the head of the family and a two-time U.S. presidential candidate, put the magazine’s parent company Forbes Media LLC up for sale in November following years of dwindling profits as digital media cut into print advertising revenue. Forbes was originally seeking at least US$400-million when it hired Deutsche Bank AG to run the sale after receiving interest from potential buyers, a person familiar with the matter said at the time.

The new investor group also includes Wayne Hsieh, co-founder of Asustek Computer Inc., who is based in Singapore, Forbes said. Elevation Partners, the investment firm run by Roger McNamee, will sell its stake in Forbes as part of the transaction.

Steve Forbes will remain chairman and editor-in-chief, and chief executive Mike Perlis will continue to lead the company. Forbes Media, which includes the magazine, digital properties, conferences and research, is profitable, the company said. The transaction is expected to close this year.

Other foreign suitors had included China’s Fosun International Ltd.; Singapore’s Spice Global Investments Pvt, whose businesses range from finance to health care and entertainment; and Germany’s Axel Springer SE, publisher of the Russian edition of Forbes magazine, people with knowledge of the matter said.

The sale marks the continued decline of American media dynasties, a once-thriving and elite group that had included the Chandlers, who owned the Los Angeles Times until a 2000 merger with Tribune Co.; the Bancrofts, who sold the Wall Street Journal to Rupert Murdoch; and the Graham family, which landed a new owner for the Washington Post in Amazon.com Inc. founder Jeff Bezos.

The few holdouts include the Ochs-Sulzberger family, who still control the New York Times; the Hearst family of Hearst Corp.; and the Newhouses, who own Condé Nast Inc.

The Forbes family had tried to stabilize its fortune by selling a 45% stake in the company to venture capital firm Elevation Partners in 2006 for about US$240-million.