What Happens to Forbes, Now That Has Been Sold

Earlier this month, I wrote a column for CommProBiz called "What the Selling of Forbes Tells Us about the State of Business Media" that raised some key points about the health of business media, namely:

• Establishing a strong brand is important for readers and advertisers but can be difficult to truly monetize.

• Standalone magazine companies are at a disadvantage to conglomerates that can spread costs and profits across a family of magazines. 

• The value shoring up Forbes is not its free popular website or its steady level of subscribers — but its conference division. 

• Forbes is very creative in finding revenue but not all ways of charging access -- like paywalls (which Forbes does not have) or separate digital subscriptions (which it does) -- are reader friendly. 

Soon afterwards, on July 18, Forbes, which had put itself up for auction in the fall of 2013, announced that it had sold itself for more than $300 million to Integrated Whale Media Investments, a Hong Kong investor group. The asking price had been above $400 million, and the Wall St. Journal had said some "traditional media companies" had offered bids of $200 million but were rebuffed by Forbes. The valuation of Forbes Media is at $475 million, roughly what the family had been asking for.

As part of the sale, Elevation Partners is selling its entire stake. According to the Wall St. Journal, Elevation Partners, which had invested $264 million in 2006, "would recoup substantially all of its investment." Which is to say: Elevation did not make money on owning a portion of Forbes. 

Additionally, "The Forbes family will take some cash out as well, although the precise amount isn't known." Which means the Forbes family has limited its potential liabilities without making much money on the deal.

Meanwhile, here are a few key facts about the business of Forbes from the sale include:

• Forbes's print circulation increased in 2014 to 6.1 million, a record for the magazine and much higher than competitor Fortune (at 3.6 million, down from 3.8 million a year earlier). However, Forbes offered heavily discounted subscription fees that shored up its print circulation.

• Print advertising has continued to drop, declining 11% to 650 pages compared with 2013. (Fortune's ad sales declined 4.7% to 665 pages over the same period.

• Traffic to Forbes's websites increased 17% to 27.7 million unique desktop and mobile visitors last month in the U.S., which makes Forbes the third-largest business and financial news provider online behind Yahoo and Dow Jones.

In my next blog post, I'll address the editorial implications of the sale of Forbes.