| LOS ANGELES
LOS ANGELES Oct 9 Variety, the century-old
entertainment trade newspaper once considered the bible of the
movie industry, is being sold to online publisher Jay Penske and
private equity firm Third Point LLC for about $25 million, two
sources with knowledge of the deal told Reuters.
Penske and Third Point have struck a deal to buy the
money-losing, 107-year-old newspaper from medical and technical
publisher Reed Elsevier, which put it up for sale in
March, the sources said. The sources requested anonymity because
the deal has not been announced.
The 33-year-old Penske, youngest son of racing legend and
businessman Roger Penske, built an online entertainment empire
buying sites including MovieLine.com and the celebrity site
HollywoodLife.com. The most visible property of his Penske Media
Corp is DeadlineHollywood.com, bought in 2009 and run by founder
Nikki Finke, considered Hollywood's most influential blogger.
Finke is expected to advise Penske on the remaking of
Variety, which loses an estimated $10 million a year, according
to one of the sources.
One option being considered is trimming Variety's staff,
making it a daily rather than a weekly, and running longer,
trend pieces, the sources said. Variety could be twinned with
DeadlineHollywood.com under Finke, whose site has built a
reputation for breaking industry news, they said.
Billionaire Ron Burkle and New York hedge fund Avenue
Capital, owner of the National Enquirer newspaper, were early
bidders for Variety with offers around $25 million, said two
sources with knowledge of the earlier process.
Reed Elsevier spokesman Tom Reller did not respond to phone
and email messages. Penske confirmed a deal was in the works but
did not divulge details.