Conde Nast to buy Fairchild Pub division
NEW YORK — The Walt Disney Co. said Tuesday it has agreed to sell its Fairchild Publications magazine division to Advance Publications’ Conde Nast, owner of Vogue, Glamour, Mademoiselle and a host of other titles.
Financial terms weren’t released, but the deal, which has been expected, is reportedly worth about $650 million. Conde Nast rival Hearst Communications, publisher of Cosmopolitan, was also said to be interested in Fairchild but was outbid.
Advance has also agreed to grant Disney’s Buena Vista Internet Group nonexclusive rights to publish content from Fairchild’s W, Jane and Women’s Wear Daily within its online properties, which will include a new women’s site. The two companies will look at forming an Internet joint venture using content from both Advance and Disney magazines.
Fairchild owns a dozen consumer and trade publications, a book-selling division and Fairchild Urban Expositions, a trade show partnership.
Disney said it will retain Los Angeles magazine, which was never officially part of Fairchild. Insiders have indicated that Disney chairman-CEO Michael Eisner felt strongly about keeping that publication in order to maintain a hand in the city’s press. He also views it as a better with fit with Disney’s core entertainment businesses.
Disney acquired its publishing group as part of its $19 billion acquisition of Capital Cities/ABC in 1996. It has sold several newspapers and other properties over the past few years and put Fairchild on the block briefly but yanked it off.
Cutting to core
“Fairchild has long been a standard-bearer in the publishing industry,” Eisner said. But despite the unit’s strengths, he added, “Disney is focused on the long-term growth of our core brands and entertainment assets.”
Disney’s earnings and its stock price have been slipping, and the company is retooling across the board. There’s a major cost-cutting effort under way, and all non-strategic holdings are being reviewed. Publishing was the first shoe to fall, and Disney is also exploring a possible sale of its Anaheim sports teams, the Angels and the Mighty Ducks.
Wall Street has praised the sale of Fairchild as a sign that Disney is serious about tackling its problems.
At Conde Nast, Vogue editor Anna Wintour has reportedly been itching to get her hands on Fairchild for years. Women’s Wear Daily and W are bibles for the fashion industry. W in particular has been exploding, with ad revenue of more than $86 million last year. It’s possible Wintour may be contemplating some kind of a combination of Mademoiselle and Jane.
The transaction is expected to close by the end of the year.
News of the agreement, which has been percolating for a week, has some fashion and beauty advertisers worried over the ever-smaller number of players dominating relevant titles. Along with Vogue, Mademoiselle and Glamour, Conde Nast holds Allure, Self, Vanity Fair, the New Yorker and others, making it the master of the upscale fashion magazine.
The S.I. Newhouse Jr. company will also wet its feet in the world of trades. Fairchild’s extensive list includes Executive Technology, Supermarket News, Children’s Business, Footwear News and Salon News.
Disney’s publishing assets will still include Hyperion Publishing, ESPN, Family Fun and Discover magazines, and, of course, its newly launched title Talk, edited by Tina Brown and jointly owned by Disney’s Miramax and Hearst.