Zinio Responds To Sale Reports
The company confirms it's looking for more capital.
Speculation on a potential sale of digital magazine and newsstand provider Zinio has been swirling for some time now, and Fortune reported Monday that the company had indeed put itself on the block:
"The San Francisco-based company has hired investment bank Montgomery & Co. to manage the process, with one source saying that the company is seeking between $50 million and $100 million. No idea yet if there is buy-side interest at that price."
Since that report, we put in a request for comment and Zinio has released a statement, telling Folio:, "Committed to growing the company, we have retained Montgomery & Co to facilitate capital raising strategies and discussions. While the company has been engaged in similar discussions in the past, Zinio has never had a stronger vision, strategy and roadmap to engage the right set of potential partners."
The timing of Zinio's capital raising efforts comes on the heels of the sale of Texterity, a digital magazine services provider, to Godengo, a company that has roots in regional magazine web development and now builds content management systems.
It's not necessarily a coincidence, but it is a very crowded market out there for digital magazine services and newsstand providers.
In Texterity's case, the company ran out of money before it could take the necessary next steps to fund growth plans.
Further speculation over a potential buyer could zero in on a technology company or, say, a company like RR Donnelley, a printer that's been rapidly expanding into digital content services. The company, with $10 billion in 2011 revenues, has made a series of acquisitions over the last year. Importantly, the company bought LibreDigital last year, which provides digital magazine content production, analytics and distribution services.
It's also bought Journalism Online, maker of the Press+ paid content platform; scooped up EDGAR Online for $70.5 million; and invested $2.5 million in catalog shopping app CoffeeTable, which lets readers make purchases directly from within the application.
With 'traditional' publishers quickly making inroads into nontraditional content sales and development, their suppliers have only had to follow suit and acquisitions are the quickest way to play catch-up.
-- Bill Mickey is editor of Folio:. Follow him on Twitter: @billmickey
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