Closing the book on Viacom pubs

Moguls lose small fries to bulk up on bigger meals

Thump, thump. Big media’s on a treadmill, shedding assets seen as non-core for the modern showbiz conglom.

Viacom’s Sumner Redstone disclosed last week that he may be shopping publisher Simon & Schuster and Paramount Parks, along with small-market radio and TV stations that can’t provide that big-city booty.

Time Warner, Walt Disney and News Corp. have all dumped sports teams. TW unloaded Warner Music and tried to sell Warner Books to Bertelsmann’s Random House. Deal (said to be worth about $350 million) ultimately collapsed.

Random House or News Corp.’s HarperCollins would be logical buyers for Simon & Schuster. Viacom sold the house’s educational unit to Pearson in 1998 for $4.6 billion. Round two would see a much smaller number.

And ubiquitous private-equity firms are always prowling for deals. Thomas H. Lee and Bain Capital’s $1.3 billion buy of Houghton-Mifflin from Vivendi in ’03 was one of the heftiest publishing pacts in recent years.

Publishing, like music and sports, once sounded like good synergy with film and TV, but really wasn’t.

“The profit margins are very skinny, unless you’ve got a big back catalog. It’s a lot of work, a lot of hit or miss,” says one Wall Streeter.

But remember: Moguls are losing their small fries to bulk up on bigger meals. Time Warner wants giant cabler Adelphia. Cash-rich Viacom threw ratings agencies into a tizzy Jan. 11 when Redstone said he may borrow much more — debt rating be damned.

The question is: For what?