Hearst Agrees To Buy Road and Track and Car and Driver
In one massive swoop, Hearst has now become the second largest magazine giant in the United States of America. In an incredible power play, the company purchased over 100 titles from French publisher Legardère.
Those 100 different titles cover 15 countries, so Hearst has quite the empire of paper, but the two that stand out among the rest are Car and Driver and Road and Track. These two legendary automotive publications are both very old, with the former being created in 1955 and the latter in 1947.
According to The New York Times, Hearst paid out $890 million, which seems odd considering the trend towards online media. Still, it was a worthwhile move by both companies, as each will get something out of the deal.
“Magazines are going to be a part of our future as far as the eye can see,” said Frank A. Bennack Jr., Hearst’s chief executive. “So the question for us was how do we strengthen our position in that regard? This seemed to fit us nearly perfectly.”
Hearst has been sitting back with prying eyes, as they watch Condé Nast from a distance. The company has wanted to go head-to-head with them on the fashion and beauty advertising front and the acquisition of American Elle, as well as the many other publications, should help that cause.
Legardère has been under pressure from its stockholders for some time to slim down its international affairs. With the sale of these magazines, the company can now focus on domestic issues.
This new acquisition should help Hearst climb out of third place in the advertising arena. The New York Times reported that Time Inc. led the advertising battle with $4 billion, followed by Condé Nast with $2.5 billion and Hearst with $2.4 billion. With these new publications, Hearst might have the power to jump to $3.5 billion.
[New York Times]
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