ACP sale will breathe life into magazine industry: Matt Handbury

By By Amy Kellow | 5 September 2012

Industry analysts including magazine icon Matt Handbury have argued ACP's sale to Bauer will allow the publisher to move away from "inexperienced owners" and may bring renewed enthusiasm to the magazine category.

Last night's announcement came amid rising industry speculation over the last month, with several anticipating the sale to be worth $600 million dollars. It is understood Nine will use the money to pay down some of its $2.7 billion of senior debt.

Reports of a sale surfaced just hours before the official statement, with publications believing the price was set for $500 million, which was $100 million less than the anticipated asking price.

Publishing heavyweight and nephew of Rupert Murdoch, Matt Handbury, told AdNews: "Magazines have previously been the lowest common denomonator in the industry due to the biggest player, ACP, not being firm on its advertising rates.

"[The magazine industry has] also totally and undeservedly ended up at the bottom of the media pile in the face of the digital transformation. Hopefully, the sale will be the beginning of a turn around of all that."

Handbury anticipated the German takeover will be "a major step forward in what has been a pretty dismal print period" in terms of direction and advertising interest. 

Speaking of Germany's publishing power, Handbury attributed it to its ability to leverage its television advertising restrictions to benefit print and create a premium product.

"Hopefully Bauer will have the confidence in the product and stop giving discounts to advertisers", he said.
"Australia has always had a fantastic print product, but what has been missing is this confidence in advertising sales and the price it is worth.

"It seems to have been run by inexperienced owners which has allowed media buyers to extract extraordinarily unnecessary discounts."
Handbury further argued publishers must make advertisers aware of the powerful bond titles have with their readers when marketing spots at a premium price.

In terms of what the sale means for Nine and CVC, Handbury said Nine would most likely be better received without the percieved "smelly free falling print component".

Handbury was once poised to buy ACP himself, and said ACP was "most definitely worth" its reported $500 million sale price.

MediaCom head of implementation, planning and investment Nick Keenan contended the takeover would be positive for ACP given many of its past decisions had been limited due to its private ownership.

"It will be very healthy for the medium and the channel. ACP is now allowed to cut loose and to innovate and move with an increasing degree of flexibility and speed, which allows them to react to the market. It's exciting", he said.

"Bauer has a good track record. They're good publishers who know what they're doing and I think for ACP and the quality of its titles and its products, the takeover can only be a good thing.

In terms of Nine's cross-platform play Power, Keenan added: "Powered will lose fluidity of having the control that they have had in terms of how magazines are used across that platform."

Keenan said it will be interesting to see what happens in coming weeks, given Pacific Magazines and and NewsLifeMedia are owned by public entities.

ACP titles include Harper's Bazaar, Cleo, Cosmpolitan, Woman's Day and Women's Weekly.

Bauer Media Group, based in Hamburg, Germany, publishes around 400 magazines across Germany, Britain and the US. Titles include Grazia, Closer, FHM, Zoo and a number of women's lifestyle magazines.

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