For generations, a sign of business success was appearing on the cover of Fortune magazine.Today, the truest symbol may be to own the publication outright.
Des Moines-based publisher Meredith announced on Friday that it has agreed to sell Fortune for $150 million to Fortune Media Group Holdings Limited, wholly owned by Chatchaval Jiaravanon, son of Sumet Jiaravanon, executive chairman of Thailand’s biggest conglomerate, Charoen Pokphand Group.
The transaction, a personal investment for Jiaravanon, is expected to close in 2018.
Meredith picked up 88-year-old Fortune as part of its $1.8 billion acquisition of New York giant Time Inc. in January. Two months later, it announced that it would sell some of the oldest brands in Time Inc’s portfolio: Time, Fortune, Money, and Sports Illustrated. It sold Time to Salesforce CEO Marc Benioff and his wife Lynne in September for $190 million.
The Charoen Pokphand Group, or C.P. Group, is a Bangkok-based conglomerate with businesses in telecommunications, food, retail, automotive, finance, and pharmaceuticals. The organization is owned by the Chearavanont/Jiaravanon family and known for its CP All chain of convenience stores in Thailand as well as True Corp., which owns Thailand’s largest TV and Internet provider.
Jiaravanon says he intends to increase investment in Fortune’s “digital capabilities, geographic expansion, and editorial talent as part of a strategy to become the premium business content provider worldwide.”
“Our vision is to establish Fortune as the world’s leading business media brand, with an always-on reach and global relevance,” he said in a statement. “The demand for high quality business information is growing, and with further committed investment in technology and brilliant journalism, we believe the outlook for further profitable growth is excellent both for the publication and the events business.”
Fortune is known for its franchises including the Fortune 500, 100 Best Companies to Work For, Most Powerful Women, World’s Most Admired Companies, and 40 Under 40, among others. It hosts a series of annual conferences including its Global Forum, Most Powerful Women Summit, Brainstorm Tech and Health conferences, and CEO Initiative.
Clifton Leaf will remain editor-in-chief of the publication. “I am very excited for this new era in Fortune’s distinguished 88-year-old history,” he says. “The global story of business has never been more compelling than it is today, and our commitment to telling that story in all of its rich complexity and nuance has never been stronger.”
Alan Murray will remain its president and become CEO. “I am pleased that we have found an owner for Fortune who believes in our mission, values our editorial independence, wants to invest in our journalism, and thinks Fortune can be the leading brand providing business insight and information around the world,” he said in a statement. “Watch this space: We will be doing big things in the future.”
As with its Time divestiture, Meredith will provide short-term business continuity services to Fortune and has entered a multi-year agreement with Jiaravanon to provide services including corporate sales, consumer marketing, subscription fulfillment, paper purchasing and printing.
Fortune magazine, a founding brand of the once-mighty Time Inc. empire that started publishing right after the stock market crash of 1929 and went on to chronicle the rise and fall of America’s biggest companies, has been sold to a Thai businessman for $150 million.
Chatchaval Jiaravanon, whose family controls Charoen Pokphand, one of Thailand’s largest companies, will acquire Fortune as a personal investment, according to a statement from the magazine’s current owner, Meredith Corp. He intends to increase investment in Fortune’s digital capabilities, geographic expansion and editorial talent, the statement said.
Mr. Jiaravanon is the second unexpected buyer for a Time. Inc. title in recent months. In September, Meredith said it would sell Time magazine to Marc Benioff, the billionaire chief executive of the software company Salesforce, for about $190 million.
“This was a great outcome,” Alan Murray, who had been Time Inc.’s chief content officer and will become Fortune’s chief executive, said in an interview, adding that Mr. Jiaravanon “has ambitious goals for the magazine.”
In the statement announcing the deal, Mr. Jiaravanon promised to invest in technology and journalism at Fortune.
Like all magazines, Fortune’s print business has declined — ad pages for 2018 are down more than 25 percent — which prompted the title to focus on other potential areas of growth, specifically digital advertising and conferences. Those businesses now make up about 62 percent of Fortune’s nearly $100 million in annual revenue, and the magazine makes about $10 million in profit when not taking into account interest, taxes, depreciation and amortization.
The purchase price and Mr. Jiaravanon’s willingness to invest in the magazine were key factors in his winning bid, Mr. Murray said, although the specific amount of additional investment was not discussed. The magazine is likely to add to its staff and will consider putting a paywall on its website.
Meredith moved quickly after acquiring Time Inc. last year to sell the magazines that did not fit into its existing stable: glossies centered around home and lifestyle and geared toward female readers. The company announced in March that it was seeking a buyer for Fortune, as well as for Time, Money and Sports Illustrated. Although Meredith’s decision to sell those titles was widely expected, it nonetheless signaled a further decline of the magazine industry.
Auctioning off the magazines was more complicated than Meredith executives had expected. As a case in point: Mr. Benioff was close to buying Fortune before switching his preference to Time when he saw that it was a bigger business. At that point, Meredith had to seek new bidders for Fortune.
Mr. Murray, who helped lead the process along with and Meredith’s banking adviser, Citigroup, said in September, “It was a learning process for me, and these things just take a lot longer than you think they would.”
Mr. Jiaravanon, 56, who will not play any role in managing the magazine, emerged as a suitor only within the past three weeks, Mr. Murray said. Meredith had talked to about a dozen serious buyers for the magazine this year.
The deal was reached Friday evening in Hong Kong, where Mr. Jiaravanon celebrated his acquisition at dinner with Mr. Murray.
Fortune, the second title to be hatched by Henry Luce, Time Inc.’s founder, has won numerous awards over its 88 years. It became known for its in-depth features, which often recast a company’s rise or fall as a lively case study.
That a little-known businessman like Mr. Jiaravanon would become Fortune’s new owner underscores the wildly shifting prospects for America’s best-known magazines. But that was one of the key reasons for Mr. Jiaravanon’s interest.
“He loves the brand,” Mr. Murray said. “And he really has an appetite to invest.”
Fortune has not covered Mr. Jiaravanon or his family conglomerate, known as C.P. Group, extensively. The family business is the largest private company in Thailand, with interests in department stores, banks, telecommunications companies and other businesses. The company’s senior chairman, Dhanin Chearavanont, often tops the list of Thailand’s richest people.
Mr. Jiaravanon, a graduate of the University of Southern California, also sits on the board of True Corporation, a Thai media company with over $4 billion in revenue.
His ownership of Fortune immediately vaults Mr. Jiaravanon onto the world stage, but he did not buy the magazine “for personal glorification,” Mr. Murray said. “The fact that he’s not talking to you is evidence of that.”