Hearst drops out of Emap consumer magazines race

by Daniel Farey-Jones, Brand Republic 06-Dec-07, 15:55

LONDON - Hearst has pulled out of the bidding for Emap's consumer magazine division, which includes gossip magazine Heat and women's glossy Grazia.

The development was confirmed in an internal email to staff today by Duncan Edwards, chief executive of Hearst's UK operation, The National Magazine Company.

Emap is expected to announce the winner of the auction shortly. It received final offers at the start of the week and held a board meeting yesterday.

Reports have indicated that bids for the consumer magazine division have fallen short of the £700m valuation Emap was aiming for.

It is unclear why Hearst, publisher of Cosmopolitan and Esquire, and its partner Exponent withdrew, and which companies this leaves in the running. The Times has claimed Hearst withdrew because it was outbid by another company it believes to be the German publisher H Bauer, publisher of Take a Break and TV Choice.

A publishing industry source contacted by Brand Republic backed up the report of Bauer's bid, adding that he understood a US private equity firm called Apollo was also involved in a separate bid.

He went on to say both parties had made offers for Emap's radio division, in addition to the consumer magazine division.

This could disrupt the efforts of the companies pursuing the £400m radio division, which include Global Radio and the partnership of private equity firms Veronis Suhler Stevenson and Vitruvian.

There have been no new developments in the bidding for the £1.3bn business-to-business division. It is understood there are three bid teams: Apax and Guardian Media Group, Candover and Cinven, and Providence and Permira.