Sequential Brands acquires Martha Stewart Living
NEW YORK — Martha Stewart’s empire of recipes, spatulas, pots and books is heading to a new place.
Martha Stewart Living Omnimedia will be acquired by Sequential Brands in a cash-and-stock deal valued at about $353 million US.
Martha Stewart will remain as chief creative officer and will be nominated for the board, where she is now non-executive chair. She’ll also be a “significant” stockholder.
Sequential Brands Group, which owns and licenses a number of consumer brands including Ellen Tracy, Jessica Simpson and Linens ’n Things, will pay $6.15 per share.
The deal is expected to close in the second half of the year.
In a statement released Monday, Stewart called the deal a “transformational merger.”
“The Sequential team is smart, hardworking, and understands the power and limitless opportunity of the Martha Stewart brand and its formidable design, editorial and marketing teams,” she said.
The deal to sell the company ends the era of an independent publishing and merchandising empire founded by the domestic doyenne in 1997. Over the past decade, however, the empire has been unravelling. Stewart’s own legal woes in 2004 led to a fivemonth prison sentence.
Stewart Living Omnimedia became beset by the same challenges facing the entire media industry as her fans went online to get tips on cooking and decorating. Publishing, the mainstay of her empire, has been replaced by merchandising. Martha Stewart also became ensnared in a three-year court battle with J.C. Penney and Macy’s over the sale of her merchandise.
The sale follows Martha Stewart Living’s agreement in October to allow Meredith Corp. to take over ad sales, circulation and production for its magazines. The goal: to focus on creating content and products such as furniture, crafting tools and pet products. In May, Martha Stewart reported a nearly 50 per cent drop in first-quarter revenue as it handed over control to Meredith.
In the latest quarter, publishing revenue fell 70 per cent to $5.7 million US, revenue for its merchandising business fell 16 per cent to $10.9 million and revenue in its broadcasting unit fell 46 per cent to $367,000. Products are sold by several retailers, including Home Depot, Macy’s and PetSmart. In 2012, the company discontinued Whole Living and made Everyday Food, a supplementary issue to its flagship Martha Stewart Living.
Martha Stewart Living has reported annual losses every year since 2003 with the exception of 2007. For the past seven years, the company’s annual sales have been on a downward slope, reaching $141.9 million last year, down from $327.9 million in 2007.