Sports Illustrated has been on the market for some time, and back in April we wrote about how Meredith was looking to sell SI for something like $150 million. Since then, there hasn’t been much movement on the sale front, although there was a fun stretch where Dan Gilbert and Tony Robbins were reportedly interested.
For a while, that lack of movement seemed to be a result of Meredith asking too much for SI. But according to a Reuters report from Carl O’Donnell and Liana B. Baker, Meredith’s patience might be paying off, as they’re apparently close to completing a deal. Not with an existing media company, but with a former NBA player.
Ulysses Lee “Junior” Bridgeman, a former U.S. basketball player who became a fast-food mogul, is in the lead to acquire Sports Illustrated magazine from U.S. media company Meredith Corp (MDP.N) for about $150 million, people familiar with the matter said on Friday.
The deal would be the result of a review that Meredith is carrying out in its portfolio, following its $1.84 billion acquisition of Time Inc last year. It has already sold off its Time and Fortune magazines and is exploring a sale of Money Magazine.
Bridgeman is in the final stages of negotiating a deal for Sports Illustrated after lining up acquisition financing, the sources added. If his effort is successful, a deal announcement could come by the end of the year, according to the sources.
Bridgeman is a former Indiana high school legend from East Chicago who went on to play at Louisville before a lengthy NBA career. After his playing days, he ended up going into an entirely different industry, becoming a restaurant franchise mogul. Bridgeman’s interest was first reported in October by the New York Post‘s Keith J. Kelly.
Considering Bridgeman is apparently willing to offer the asking price, it might be surprising that the deal hasn’t gone through yet, but as Reuters notes, it’s for a very simple reason: Bridgeman isn’t in media or publishing. That means a lack of infrastructure, which means the buyers will need a way to actually print the magazine, among other things.
One aspect of the deal still being hashed out in the negotiations is the outsourcing agreements related to printing and paper costs of the magazine, one of the sources said. These discussions are common when a buyer who does not own a media company purchases a magazine, the source added.
For example, when Marc and Lynne Benioff bought Time magazine for $190 million in cash in September, Meredith entered into a multiyear agreement with them to provide services such as subscription fulfillment, paper purchasing and printing.
If the deal goes through, it will be interesting to see how a new entrant to the world of media handles the Sports Illustrated brand going forward.
[Reuters]
