Post bankruptcy restructuring, Reader's Digest scouts for buyers
18 July 2011
Reader's Digest Association (RDA), the publisher of the venerable monthly household journal the Reader's Digest magazine, has put itself up for sale and hopes to fetch around $1 billion, The Wall Street Journal today reported, citing people familiar with the matter.
RDA, co-founded in 1922 by Lila Bell Wallace and DeWitt Wallace, has hired financial advisers to scout for potential buyers, which includes private-equity firms and other media companies, the journal said.
The process may result in the sale or spinoff of some RDA's properties rather than the sale of the entire company.
The Pleasantville, New York-based media company founded in 1922 by DeWitt Wallace and Lila Bell Wallace, had emerged from bankruptcy protection in early 2010 after it had filed for file for pre-arranged bankruptcy protection in August 2009. (See: Update: Reader's Digest to file for bankruptcy protection).
RDA is the world's largest-circulation having more than 130 million consumers globally. With offices in 44 countries, the company reaches customers in 78 countries, publishes 90 magazines, including 50 editions of Readers Digest, the world's largest circulated magazine. .
RDA's problems came after an investor group led by private equity group, Ripplewood along with J Rothschild Group, GoldenTree Asset Management, GSO Capital Partners, Merrill Lynch Capital Corporation and Magnetar Capital took it private in a $2.6-billion buyout deal in 2007.
The deal left the 88 year-old company with a debt of $2.2 billion.
Post bankruptcy, RDA, the company launched three magazines, Reverse Diabetes, walk it off and No Fail Weight Loss. The company's stock has doubled over the past year and it went on to acquire Haven Home Media, the sector's leading online vertical network in April this year.