Motor Trend/Automobile Publisher Files for Bankruptcy
Bloomberg reports that Source Interlink has gone Tango Uniform. You may know Source Interlink as the publisher of Motor Trend, Automobile and [a claimed] 73 other publications. Not to mention [a claimed] 90 websites. Like the formerly octo-branded GM, Source Interlink simply bit off more than it could chew—and then discovered there wasn’t enough to eat. “The company listed debt of $1.9 billion and assets of $2.4 billion . . . US magazine advertising revenue in the first quarter fell 20 percent from a year earlier, according to the Publisher’s Information Bureau, an industry group. US auto sales tumbled 37 percent in March. Source Interlink hasn’t reported a profit since the second quarter of 2007.” This after spending $1.2 billion to buy a package of titles from PrimeMedia in 2007. As for the future . . .
Interlink says it hopes to use C11 to retire a bit of debt ($1billion), raise some operating revenue ($100 million) and take the company private. The immediate effect of Source Interlink’s C11 filing on the fiercely independent buff books (just kidding) should be minimal. Long term, the axe will swing. And prospects are not good; the buff books are damaged brands in a market crowded with smaller, leaner competitors. And we all know how well that can turn out.
More by Robert Farago
Comments
Join the conversation
tedj101 writes: Your [muskets] are still on the mantle? What are you, some kind of a nut ! Yeah...but if you haven't noticed, there's a musket ball shortage out there. :-) It will be interesting to see what happens in bankruptcy. The only thing that is certain: a Pontiac will not be the next M-T Car of the Year.
So, sounds like being a shill for players in a bankrupt industry doesn't actually work as a biz plan. Who knew?
According to the guys over at AutoSpies, GM owes Source Interlink millions of dollars for advertising in their mags and that it will never be paid. They seem to think that Source Interlink's bankruptcy was triggered by GM's.
Sooo... now that they're gone... where do we go for the magazine title auction? I call dibs on Sport Compact Car, Turbo, Hot Rod and Automobile... you can all quarrel over the rest. I might not end up publishing, but it'll feel good being a magazine magnate.