Then AND NOW - Primedia - Brief Article - Statistical Data Included

A sense that transcends trends Grace Mirabella's tennis game is "terrible." She just doesn't have time to play--what with a more pressing labor of love, Mirabella the magazine, demanding so much of her energy. The title celebrated its one-year anniversary in June, but the publication director isn't stopping to catch her breath. She wouldn't want to lose momentum.

Alas, Mirabella now loins Lear's in the graveyard for magazine namesakes. Hachette Filipacchi bought the book in 1995 from Rupert Murdoch's News Corporation to target the fashionistas and the up-and-coming professional female. (Grace left the stage just as Hachette relaunched the magazine.) But the growth in the mid to late 1990s of such female titles as InStyle and Marie Claire--as well as standbys Cosmopolitan and Glamour--left Mirabella in the dust. Ad pages were flat or worse during that period, and were down a whopping 48 percent in this year's first quarter compared to 1999. Hachette boss Jack Kilger--no sentimentalist--did the math and decided to pull the plug in late April to focus his efforts on struggling Hachette titles George and Premiere.

$1 billion in acquisitions?

No doubt it was a hot pursuit-maybe too hot for the suits on Wall Street. The company now called Primedia was founded in 1989 with a $1 billion plan for growth through acquisitions. Reilly played the strategy to the hilt, first buying Intertec (now publisher of Fouo:) in the summer of 1989. More titles came via acquisitions from McGraw-Hill, Andrews Communications and Thomson Corporation. The buying binge continued unabated when the company went public in 1995. Indeed, Reilly made 57 acquisitions between 1997 and 1999 alone. At the end of the decade, Primedia had 250 magazines in the mix (from 28) and revenues had grown from $220 million in 1989 to $1.7 billion in 1999.

K-III Holdings' William Reilly is somewhat wary of financial gurus who plot off-the-chart "Lotus 1-2-3 projections" for magazine growth. "Companies don't grow that way," he says. Nevertheless, K-III's recently named president and CEO plans to pursue aggressively the development of his emerging publishing company.

Despite the spending spree--or perhaps because of it--Primedia's stock languished. Reilly left a vapor trail in late 1999 and was replaced by NBC's Tom Rogers. Rogers brought in his own team, put Primedia's checkbook on the shelf--and watched the company's stock start to soar; its 52-week high was $34, but these days hovers around the $18 range. Rogers insists acquisitions will now take a back seat to organic expansion.

COPYRIGHT 2000 Copyright by Media Central Inc., A PRIMEDIA Company. All rights reserved.
COPYRIGHT 2003 Gale Group