Advocate publisher cashes out
PlanetOut Inc., publisher of The Advocate, Out, The Out Traveler and other LGBT-focused magazines, will sell its magazine and book publishing arm to an affiliate of Here Networks.
As part of the deal, PlanetOut will provide marketing and advertising for Here television and films. Final terms for the agreement should be finalized by April 30, and the transaction is expected to close by August 31. The San Francisco Business Times reported that the selling price was $6 million.
A PlanetOut spokesperson confirmed the deal, but declined to answer any other questions. Here could not be reached for comment.
In a statement, PlanetOut CEO Karen Magee said that the Here's co-founders had long been supporters of PlanetOut titles, and that she expected them to grow the business.
“Most importantly,” she continued, “we believe that the divestiture of our publishing businesses will enable PlanetOut Inc. to devote all of our attention and resources to our core online businesses, Gay.com and PlanetOut.com. This will ensure that all of our powerful brands have a better chance to grow and prosper, and will ultimately produce greater value for our shareholders."
The percentage of PlanetOut revenue contributed by its online holdings has declined in recent years, from 87% in 2005 to 51% in 2007. Total PlanetOut revenue for 2007 reached $70 million. GAAP net loss for the year was $51.2 million.
Total verified circulation for The Advocate was 169,882 in 2007, up from 141,465 in 2006. Ad pages, however, were down 27.6%, from 790.3 in 2006 to 572 in 2007.
The embattled media company disclosed that it was in a financial crisis a year ago; it received a $26.6 million bout of funding from private investors in the summer of 2007 that executives said should last it through 2008.
PlanetOut has retained investment bank Allen & Co. to explore business options with its online core.