Reed Elsevier will try once again to sell off a chunk of their trade magazines from the Reed Business Information division. The company terminated the first attempt at a complete sale of the division late last year when they were unable to extract “acceptable terms” from bidders. They said then they would “divest RBI in the medium term when conditions are more favorable.” But just a week ago, new Reed ceo Ian Smith was tipped in the Telegraph as readying a new strategy to “retain the core business.”
This morning RBI ceo Keith Jones told employees they intend “to divest a significant part of the RBI US business,” including the literary magazine group of PW, Library Journal and School Library Journal. CEO of the US division Tad Smith has resigned “to pursue a new job challenge.” John Poulin is acting ceo for RBI US, “for the portfolio we are to divest and for all support services within RBI US.”
The company is keeping Variety, the sprawling Reed Construction Data business, and RS Means, Marketcast, LA411 and Buyerzone, but will sell the other US-based properties. They will also keep the UK-based publications, which include the journal New Scientist. Smith writes that “these are challenging times for all media businesses. The changes we have announced today will position RBI well for the future.”
Reed Elsevier made broader news this morning in announcing a secondary offering of stock that aims to raise about 1 billion pounds to help pay down their 5 billion pounds in debt. The offering, which will comprise about 10 percent of shares, drove the stock down more than 10 percent in trading today. The company also announced six-month results, with a 52 percent drop in profits. In the RBI division, constant currency sales were down 17 percent and adjusted operating profit was down 43 percent, though results were up at Elsevier.