American Media has agreed to acquire the U.S. edition of OK magazine, almost six years after Richard Desmond's Northern & Shell brought the celebrity powerhouse here only to encounter more difficult headwinds than anticipated. Terms were not disclosed.
"OK magazine is a very important strategic acquisition for AMI, as it increases our market share in newsstand unit sales from 30% to 36 %," American Media's chairman and president-CEO, David Pecker, said in a statement from the company. "It also allows us to offer our advertisers a wider range of celebrity coverage than any single publication or group of titles from any publisher."
The deal was first reported by Sky News. "We are delighted to welcome American Media to join the OK family of 23 different editions around the world," Sky News quoted Mr. Desmond saying. "The U.S. is a very important market for the brand and its continued expansion." Mr. Desmond's office referred calls to a spokesman, who did not return a call by deadline.
OK, a strong brand in countries including the U.K., got its U.S. edition in August 2005, when Northern & Shell promised to spend $100 million over six years to dominate the competition here. Instead the U.S. edition cost $175 million before five years were up.
Northern & Shell began exploring options for the U.S. edition earlier this year, garnering a bid from Time Inc., the publisher of People magazine, but American Media is the one that emerged with a deal. American Media's portfolio already includes celebrity brands Star magazine and Radar Online.
The U.S. edition of OK saw its paid and verified circulation in the second half of last year increase 3.5% from the second half a year earlier -- but still missed the magazine's 800,000 circulation guarantee by 2.4%, according to its report with the Audit Bureau of Circulations. Ad pages in the first quarter of this year declined 5.6% from the quarter a year earlier, according to the Publisher's Information Bureau.