OLD Media Moves

McGraw-Hill statement on exploring sale of BusinessWeek

July 13, 2009

Jon Fine, who covers the media industry for BusinessWeek, has the statements from the magazine’s parent company and the magazine’s president about exploring a sale of the glossy.

In an e-mail to BusinessWeek employees, BusinessWeek President Keith Fox said, “We all know that the media industry is facing unprecedented challenges. The growth of digital innovation has created new entrants, new challenges and entirely new business models for media companies. The move of readers and advertisers online, coupled with the impact of the recession on print advertising, has created additional urgency on the need for change. Given the current market environment, the Corporation has decided to explore strategic options for BusinessWeek.”

Fine also quotes a Piper Jaffray analyst who notes that any sale of BusinessWeek will result in minimal improvement of McGraw-Hill’s financial performance.

“Given [presumed] current losses and limited near-term prospects for profitability, we believe McGraw-Hill will most likely receive minimal proceeds,” wrote Peter Appert, of Piper Jaffray, in a report that came out this afternoon. “With BusinessWeek magazine accounting for roughly 2% of total [company] revenues and generating a small loss, its potential divestiture would not meaningfully impact the company’s overall financial results.”

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