dy/petersen/9″/mike1st/mark2nd

No. 32

Petersen Publishing Agrees to Buyout

One of L.A.’s biggest publishers, Petersen Cos., agreed in mid-December to be acquired by Emap, a British-based global publishing concern, for about $1.2 billion.

The deal provided a handsome premium for an investor group that acquired a controlling interest in the company two years ago for $450 million. That group included James D. Dunning Jr. and Chicago investment firm Willis Stein & Partners. At the time, co-founder Robert E. Petersen sold 87 percent of the business. The investor group took the company public about a year ago, at $17.50 per share.

Petersen started the company in 1948 when he and a partner began publishing Hot Rod magazine. Today Petersen Cos. publishes 126 special-interest magazines, which include Motor Trend and Guns & Ammo. Those titles are seen as complementary to Emap’s consumer and business titles. (One notable exception is Petersen’s highest-circulation title, Teen magazine, a publication for teen-age girls that has a circulation of 1.8 million.)

Emap has agreed to buy the company for $34 a share, meaning that Petersen will receive about $122 million for his remaining stake. Not that he really needs the money. Petersen’s personal net worth of nearly $700 million qualifies him as not only one of the richest Angelenos but also as one of the richest Americans.

On Dec. 14, the day the deal was announced, Petersen’s shares shot up 36 percent, to close at $31.31 on the New York Stock Exchange. Shares as of last week were trading close to the $34 price that Emap has agreed to pay.

D.B. Young