Tronc Inc. is in talks to buy celebrity magazine Us Weekly for $85 million to $95 million, according to media analyst Ken Doctor.
The move could give the Chicago-based owner of the Los Angeles Times extra entertainment content, and possibly traffic, for its newspaper holdings.
Tronc holds about $198 million in cash, according to public filings, suggesting that it is capable of financing the deal with Us Weekly’s owner, privately held Wenner Media.
Wenner planned to sell Us Weekly to American Media Inc. in a deal that progressed until a few weeks ago, according to Doctor, who broke news of tronc’s interest last week. It was not clear how much debt is held by Us Weekly, but Doctor said the magazine reels in from $15 million to $20 million in Ebitda on $125 million to $150 million in revenue, citing sources familiar with tronc’s negotiations.
Neither tronc nor Wenner responded to requests for comment last week.
Tronc has been on a quiet buying streak over the past several months, picking up food website Daily Meal and the Active Times, a fitness and outdoors website. It did not disclose the value of the acquisitions.
Doctor said tronc also recently purchased the Cube, a video streaming website that focuses on high school sports.
While these acquisitions might provide tronc with additional page views, it’s still unclear if the media company will be able to translate that traffic into ad revenue or digital subscriptions.
By owning Us Weekly, tronc could pull national entertainment stories into its various regional newspapers and websites. It could stand to build a particularly strong celebrity focus at the Times, which already aims to be an authoritative voice on Hollywood, Doctor said.
“Bringing Us Weekly content into the entertainment sites of all these tronc papers, … that’s a synergy, an upside,” he said, adding that the stories would have to be carefully hand-picked to avoid a clash of brands. “Whether that helps them sell subscriptions, that’s another question.”
If the Times and Us Weekly join forces, the combined companies will still face considerable competition against a host of multiplatform entertainment enterprises, such as Variety and Deadline Hollywood, that jostle for many of the same stories on show-business scoops and scandals.
Tronc’s stock dropped to $13.42 a share on March 8, down 10.1 percent from $14.85 a share a week earlier.
– Daina Beth Solomon
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