American Media, LLC today announced that it has reached an agreement in principle with James Cohen, the owner and CEO of Hudson Media, for the sale of its newsprint tabloids, including the National Enquirer (US and UK editions), Globe and National Examiner. The agreement also includes a multi-year service contract that will generate substantial fees for American Media to provide publishing, financial and distribution services for the tabloid brands.
“The sale of these brands shows their vitality in today’s newsstand marketplace where they continue to generate nearly $30 million in profit annually,” said American Media President and CEO David J. Pecker. “James and his team at Hudsonhave a proven history in publishing and have the market-based knowledge and long-term vision needed to ensure the growth of these brands.”
“Year after year, the Enquirer has continued to be one of the best-selling and most profitable newsstand titles,” said James Cohen. “But this transaction is about more than a weekly publication, it’s about a brand with extraordinary potential across multiple platforms.”
Mr. Cohen said he plans to accelerate the Enquirer’s current collaborations with Investigation Discovery, as well as the documentary shows it produces for REELZ. In addition, he sees exponential growth and engagement through weekly series podcasts from the tabloid’s archives. The recent 12-part audio documentary podcast, “Fatal Voyage: The Mysterious Death of Natalie Wood,” quickly became the #2 program among all Apple podcasts worldwide with 4+ million downloads in 2018. Expanding the National Enquirer theme parks that recently opened in Branson, Missouri and Pigeon Forge, Tennessee to other markets is another priority.
The result of this transaction is a significant deleveraging for American Media, leaving the company with only $355 million of debt. Interest expense will be reduced by $13 million per year, which will enhance the company’s free cash flow and allow American Media to continue to deleverage.
The agreement between the companies is expected to close as soon as possible once the necessary regulatory approvals have been obtained.
