Wenner to Buy Back Disney's 50% Stake in 'Us Weekly'

Will Pay $300 Million to Exit Partnership

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NEW YORK (AdAge.com) -- Wenner Media this morning said it will buy back the 50% stake in Us Weekly that it sold to Walt Disney Co. five years ago. Though Wenner didn't disclose terms, Disney said during an earnings conference call today that Wenner will pay about $300 million to get out, while Disney paid about $40 million for the stake in February 2001.
The Disney buyout isn't the first risk Wenner has taken with 'Us Weekly.'
The Disney buyout isn't the first risk Wenner has taken with 'Us Weekly.'

The big question -- why now? -- doesn't have a clear answer. Disney, which is interested in selling noncore assets, was said today to have approached Wenner about selling its Us Weekly stake, although that could not be immediately confirmed. The deal is expected to close this fall.

A gamble
The big payout makes the move a bit of a gamble for Wenner, but that's nothing new. It was a big risk for Us to jump from a monthly schedule into the weekly world back in March 2000, taking on the Time Inc. juggernaut that is People. Once Bonnie Fuller took the editorial helm, though, Us Weekly began to take off and inspired such imitation that the celebrity-weekly category has become one of the most competitive of the magazine business. (Ms. Fuller, as a case in point, eventually defected to rival American Media to try to work the same magic at Star.)

And despite continued reports of a cooling celebrity-weekly category, Us Weekly (and most of its competitors) is still growing. Us Weekly is reporting average total circulation of nearly 1.8 million for the first half of this year, 7.2% higher than the total average from first-half 2005, according to the Audit Bureau of Circulations. And even as its cover price rose 20 cents to $3.49 from $3.29 last year, its average newsstand sales passed 1 million for the first time during the first half of this year, an improvement of more than 1%.

Ad pages at Us Weekly from January through July totaled 1052.5, up 2.2% over the same period last year, and grew 10% during all of 2005 to total 1802, according to the Publishers Information Bureau.
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