Layoffs loom as Bloomberg buys BusinessWeek
Filed under: Media, McGraw-Hill
BusinessWeek has found a new home, and its identity comes as no surprise. Bloomberg LP, the financial news and information giant, has agreed to buy the 80-year-old business magazine after a public sale process that lasted throughout the summer. In announcing the acquisition, Bloomberg president Dan Doctoroff sought to position it as a move that will enrich the value of the company's flagship product, its terminal-based news service, as well as its other digital offerings. "BusinessWeek helps better serve our customers by reaching into the corporate suite and corridors of power in government, where news that affects markets and business is made by CEOs, CFOs, deal lawyers, bankers and government officials who typically are not terminal customers," Doctoroff said in a statement.
BusinessWeek's Tom Lowry reveals many more details, including the sale price, said to be between $2 million and $5 million in cash, plus the assumption of some of the magazine's considerable liabilities. (The title lost more than $40 million last year.) Lowry notes that the acquisition represents a sharp break with tradition for Bloomberg, which has only ever made one other acquisition. It also underscores the considerable clout of chief content officer Norman Pearlstine, who, as chairman of BusinessWeek, will oversee the integration of the two organizations, Lowry says.
To what extent that integration will involve a mass purge of BusinessWeek's existing personnel is a question on the minds of many. It's already known that McGraw-Hill (MHP) suggested to potential buyers that they save money by laying off 20 percent of the magazine's staff. Rumors of dubious provenance have put the expected body count even higher.
But Lowry reports that Bloomberg plans to "substantially boost the magazine's editorial pages," suggesting the plan is to invest in BusinessWeek rather than gut it. Those members of BusinessWeek's 400-person staff who survive the transition will move into Bloomberg's headquarters by next May 1 following the close of the deal, expected to occur by Dec. 1.
Those parties who looked at BusinessWeek but ultimately took a pass included Bruce Wasserstein, OpenGate Capital, Mort Zuckerman and, reportedly, Donald Trump. In the end, the bidding came down to Bloomberg and Zelnick Media. DailyFinance contributor Doug McIntyre looked at Strauss Zelnick's track record here.
To what extent that integration will involve a mass purge of BusinessWeek's existing personnel is a question on the minds of many. It's already known that McGraw-Hill (MHP) suggested to potential buyers that they save money by laying off 20 percent of the magazine's staff. Rumors of dubious provenance have put the expected body count even higher.
But Lowry reports that Bloomberg plans to "substantially boost the magazine's editorial pages," suggesting the plan is to invest in BusinessWeek rather than gut it. Those members of BusinessWeek's 400-person staff who survive the transition will move into Bloomberg's headquarters by next May 1 following the close of the deal, expected to occur by Dec. 1.
Those parties who looked at BusinessWeek but ultimately took a pass included Bruce Wasserstein, OpenGate Capital, Mort Zuckerman and, reportedly, Donald Trump. In the end, the bidding came down to Bloomberg and Zelnick Media. DailyFinance contributor Doug McIntyre looked at Strauss Zelnick's track record here.
Reader Comments (Page 1 of 1)
10-13-2009 @ 10:00PM
Doug said...
As a business reader, I've seen the quality and content go downhill fast. I used to look forward to getting the next copy, but in recent years the mag has been lacking terribly. Mcgraw has done a terrible diservice to the mag and the business community as a whole. Who would want to read a mag that details the good and bad about business written and managed by incompetants who can't even run thier own mag profitably. I'm glad to see Bloomburg buy it, it can't get any worse!
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10-13-2009 @ 10:58PM
Paps said...
The Business Week is the only objective business publication that exists. If it goes the way of WSJ, which it most likely will when and if acquired by Bloomberg, then the loss will be greatly felt by all of us who depend on this respectable publication for a fair and unbiased evaluation of the business trends. Incidentally, if Bloomberg is so great in fixing things, then why is it that they cannot fix their TV reception problem -- ie., the lower portion of the business news can not be seen.
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10-14-2009 @ 9:08AM
sgentilejr said...
The Internet has significantly reduced the importance and need for business magazines and all printed publications.
Buying Buying Business Week magazine now is akin to buying a horse after automobiles came into wide spread use.
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10-14-2009 @ 12:58PM
jake said...
I don't use Bloomberg or B.W. for news ... however to bad people will lose their jobs under Bloomberg.
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10-14-2009 @ 3:57PM
richard said...
Congradulations Bloomberg! You have acquired an excellent business publication that I have been reading for years. While Business Week is top notch already, you and your resources will make it even better. I'm looking forward to the "new" Business Week and renewing my subscriptions for a long time.
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