New York, October 14-- Business media empire Bloomberg LP has bought the immensely popular and hugely respected magazine, BusinessWeek, from McGraw Hill Cos. (NYSE:MHP) for an undisclosed price.
According to people familiar with the matter, Bloomberg has paid an amount between $2 million to $5 million that includes severance payments to be made to the executives of BusinessWeek.
"I am very proud of the tremendous contributions BusinessWeek has made to The McGraw-Hill Companies throughout its rich history. It is a truly outstanding franchise and the best source of business reporting in the world," said Harold McGraw III, chairman, president and chief executive officer of The McGraw-Hill Companies.
"We are pleased that we have reached an agreement for BusinessWeek to be acquired by Bloomberg, which shares the same high standards for editorial independence, integrity and excellence that have long defined BusinessWeek," confirmed Harold.
The magazine had been up for grabs since it was put on the auction block in July. On Tuesday it fell under the hammer as Bloomberg managed to lay its hands on it.
“BusinessWeek is one of the business world’s most recognized and trusted sources of news and insight, and we believe that it will be highly valued by our customers worldwide,” noted Peter T. Grauer, chairman of Bloomberg LP.
“BusinessWeek will be a powerful addition to our portfolio of leading news and information services,” Grauer said.
The BusinessWeek acquirement is likely to yield immense benefits to the subscribers of the Bloomberg terminal, television, online and mobile properties.
"We couldn't be more excited...We are not buying BusinessWeek to gut it. We are buying it to build it,” Daniel L. Doctoroff, president of Bloomberg LP noted.
BusinessWeek.com and the Bloomberg.com are likely to attract more visitors than any other non portal business or financial site.
The acquisition also enables the US news agency to spread out to domains beyond its core business of providing financial data to professionals.
BusinessWeek, founded in 1929, will be renamed Bloomberg Business Week. It may have been one of the most admired magazines by followers of business developments; however BusinessWeek too, was not immune to the economic recession.
As was the case with other print publications, BusinessWeek witnessed a huge dip in circulation as well as advertising revenue in recent years. The migration of readers to free news online hit it where it hurts the most. The unrelenting recession made matters worse.
According to estimates, BusinessWeek was losing a minimum of $30 million a year. This state of affairs had prompted McGraw Hill to sell it off. The transaction is likely to close during the fourth quarter of 2009.