Goldman Sachs eyes magazine market with $1bn war chest
LONDON - Investment bank Goldman Sachs is set to move into the publishing business, having amassed more than $1bn (£700m) in a war chest to start a magazine unit through a major acquisition, with Emap USA buyer Primedia thought to be top of its list.
The earmarked $1bn could swell to as much as $4bn if Goldman Sachs can bring other financial institutions on board.
Goldman Sachs is said to be targeting business-to-business and consumer publishers. So far, US publisher Primedia, which publishes a number of big US consumer titles such as Seventeen, New York magazine and the National Rifle Association favourite Guns & Ammo, has emerged as a possible takeover target.
Primedia was the company which last year aquired Emap USA for $515m, making Primedia the second-largest consumer publishers in the US.
Currently under the ownership of Kohlburg Kravis Roberts, Primedia has, however, suffered at the hands of the business press, coming under fire for its lagging stock price.
Goldman Sachs is understood to be currently approaching top publishing executives in the US to run any business. It is reported to be looking specifically for a big-hitter magazine veteran.
It has been reported that Goldman has employed executive recruiter Seiden Krieger to conduct the search for a CEO for the venture.
A number of names are thought to be on Seiden Krieger's list, including Conde Nast president and CEO Steve Florio; Hearst Magazines president Cathleen Black; and Don Logan, the Time Inc chairman and CEO. Goldman Sachs will be offering a pay packet of $45m over five years.
Goldman Sachs is already involved in the media. It is a principle investor in Village Voice Media, which publishes seven weeklies in the US including the Village Voice in New York. According to one source, the bank was also involved in the bidding for IPC Media, which eventually fell to AOL Time Warner's Time Inc last year.
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