Canadian Magazine Industry News
26 January 2012,     PLEASANTVILLE, NY
Reader's Digest Association sells property for $175 million
Meredith Corporation, a media and marketing company serving American women, has purchased Allrecipes.com, a property of Reader's Digest Association (RDA), for $175 million. Meanwhile, Masthead has confirmed reports that staff have been cut at the Canadian office of Reader's Digest for its French-language title.

"The acquisition of Allrecipes.com, the market leader in the digital food space, significantly enhances our leading consumer and advertiser proposition," said Meredith chairman and chief executive officer Steve Lacy. "It more than doubles the scale of the Meredith Women's Digital Network, and is expected to drive incremental revenue and profit growth, adding to our already strong free cash flow over time."

The transaction is expected to close later this quarter. Meredith "plans to invest in Allrecipes.com to optimize the site for today's growing online and mobile audiences."

Robert Guth, Reader's Digest Association president and chief executive officer, noted, "For RDA, this is a significant step forward in our commitment to focus our resources on our core businesses, such as the Reader's Digest brand."

This news comes on the heels of a summer 2011 report that RDA was up for sale for upwards of $1 billion. The company filed for bankruptcy protection in August 2009 and emerged in early 2010. Lenders reportedly waived debts in exchange for a stake in the company.

Masthead was told by a spokesperson that the positions of senior staff editor, senior editor and copy desk editor were abolished at its French-language magazine, Selection, and that the duties of translation and line editing have been outsourced. Folio magazine reported in December that 150 jobs were being cut at RDA, half in the U.S. and half elsewhere in the world. In January 2009, RDA announced that about 280 people would be let go.

Circulation for the two main Reader's Digest titles in Canada has been struggling. The French title's circulation has dropped 31% in the last five years, from 249,843 to 171,244, according to the ABC reports (June 2006 - June 2011). The English-Canadian Reader's Digest circulation has declined even more, 37%, from 948,019 to 597,229 in the same period.

RDA has offices in more than 40 countries around the world, including Canada. In 2008, Reader’s Digest launched two new Canadian magazines, Best Health and More of Our Canada. Best Health's circulation stands at 102,560 (ABC June 2011) while More of Our Canada sits at 50,894. Our Canada, the original sister title, registers at 197,644.
— Jeff Hayward
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