Washington Post fields several bids for Newsweek
NEW YORK (Reuters) - At least four interested parties appear to have submitted bids for Newsweek, the magazine that The Washington Post Co put up for sale on May 5.
Newsmax Media and Thane Ritchie, chief executive of Ritchie Capital Management, said they submitted bids. Private equity firm OpenGate Capital and Sidney Harman, the founder of audio equipment company Harman International Industries Inc, have expressed interest in the weekly news magazine, according to the New York Times.
Thomson Reuters Corp, which runs the Reuters news service and was reportedly interested, did not submit a formal bid this week, according to a company spokeswoman.
The Washington Post declined to comment. It put Newsweek on the block, citing several years of losses it expects will continue through this year. The first round of nonbinding bids were due on Wednesday.
Christopher Ruddy, the founder and CEO of the conservative Newsmax magazine and website, said he is attracted to Newsweek's "incredibly powerful brand" and its media personalities.
"I wouldn't bother with it if I didn't think it was valuable," he said.
Ruddy declined to give the financial specifics of the bid.
Ritchie confirmed through a spokesman that a company backed by him submitted a bid for Newsweek. Ritchie attempted to purchase the Sun Times Media Group last year.
OpenGate Capital, which bought TV Guide for $1 in 2008, did not return calls for comment. Harman could also not be reached.
Ownership Associates, a company that advises employee groups and buyers interested in setting up employee-ownership structures, said it was working with a Newsweek worker's union as it explores ways to help bidders. One of those possibilities is setting up the magazine as a company that could be partly owned by the employees.
"We are providing some assistance on the Newsweek deal," said Ownership Associates President Christopher Mackin.
Employee stock ownership plans, known as ESOPs, put the stock of companies in the hands of their workers, making them the effective owners.
ESOPs are popular because companies that use them often pay less in taxes than other corporations. That lets the companies use the money that would have gone to tax payments to help improve their long-term financial performance.
Tribune Co used such a plan as part of real estate mogul Sam Zell's buyout of the newspaper publisher and broadcaster.
Ownership Associates is on retainer with the Newspaper Guild. The company was recently involved with the sale of Maine Today Media, publisher of newspapers, including the Portland Press Herald. Employees at Maine Today own a 15 percent stake in the company and hold two seats on a nine member board.
The Washington Post previously tried to turn around Newsweek, including a redesign and a dramatic reduction in the number of subscribers to 1.5 million from 2.6 million.
In the first quarter, Newsweek's advertising revenue declined 38 percent and the magazine is expected to lose $20 million this year.
The Washington Post, known for its flagship newspaper by the same name, sold Budget Travel magazine to Fletcher Asset Management for an undisclosed sum last December.
(Reporting by Jennifer Saba and Robert MacMillan; editing by Andre Grenon)