'Variety' Acquired by Penske Media
Variety, the 107-year-old entertainment trade publication, has been acquired by Penske Media Corp., the parent company of Deadline Hollywood, HollywoodLife.com and other digital properties.
PMC announced the acquisition on Tuesday in a press release that didn't discuss terms of the deal nor specific plans for Variety's future.
The seller is Reed Business Information, which has been entertaining bids since March. During the process, Ron Burkle and the New York hedge fund Avenue Capital submitted offers.
With debt and equity financing for the transaction provided by affiliates of Third Point LLC, PMC is believed to have closed the deal with an offer around $25 million. Reed had originally been seeking at least $50 million and multiple interested parties backed out after gaining a closer look at Variety's financials.
Originally launched in 1905 by Sime Silverman as a weekly covering vaudeville, Variety began publishing daily in 1933 and grew to be one of the most respected publications covering the movie business. Among its innovations were film reviews and the use of industry slang in headlines. The publication reached its heights in the 1990s under the editorial leadership of Peter Bart, a former executive of Paramount Pictures.
In recent years, Variety has struggled in figuring out the best way to adapt to digital times. At the end of 2009, as other publications embraced the internet as an opportunity to reach beyond Tinseltown, and as entertainment blogs and new industry-focused websites emerged, Variety surprised many observers by going the other way and erecting a paywall.
The acquisition by PMC, run by Jay Penske and noted foremost for digital-based editorial, will likely generate discussion about where Variety is headed next. (The New York Times reports that a pretrial hearing has been scheduled next week in a case involving an incident in which Penske is accused of breaking into a yacht club.) On the Deadline Hollywood website, Mike Fleming, a former Variety staffer who has lately been quite competitive with his former employer, reacted to the news by openly questioning the continued existence of the paywall and Variety in its current form as a daily and weekly publication.
So far, in statements released publicly, the executives in charge of the new organization are expressing optimism about the future of the brand without indicating what sort of integration will happen between Variety and Deadline Hollywood.
"As part of this significant acquisition, we plan to rapidly build upon Variety’s foundation while extending this invaluable brand’s presence across the web, broadcast, mobile, and international markets," said Penske.
“We are enthusiastic that PMC will become the new steward of the great Variety franchise, which Reed Elsevier has built over the past 25 years, and the Silverman family for the 80 years before that,” said Neil Stiles, president of Variety.