Reader’s Digest to sell educational publisher
Reader’s Digest Association Inc. announced an agreement to sell an educational publishing business as the Chappaqua-based media company continues its restructuring in a challenging economy.
Gareth Stevens Inc., a unit of Reader’s Digest that publishes educational books for youths from pre-kindergarten through high school ages, will be sold to Roger Rosen, owner of Rosen Publishing, and Gary Spears, a co-founder of Gareth Stevens in 1984.
Reader’s Digest did not disclose terms of the sale. It has owned Gareth Stevens since a 2007 merger between Reader’s Digest and WRC Media.
Reader’s Digest said that it will continue to manage order processing and customer service for Gareth Stevens at offices in Strongsville, Ohio, until the transition to new ownership is completed in September.
Reader’s Digest, whose flagship magazine is the world’s largest with nearly 70 million readers in more than 60 countries, has been hurt by the global economic slowdown that has eroded advertising revenues and accelerated declining print subscriptions.
In May, the privately held company reported a 17 percent drop in revenues and a net loss of $462 million during its fiscal third quarter ending March 31, much worse than the net loss of $53.6 million a year earlier.
In January, Reader’s Digest responded to the challenging economy with a restructuring program that included layoffs of about 280 employees, or 8 percent of its global work force of 3,500.
The restructuring also has included asset sales as Reader’s Digest repositions its businesses. Gareth Stevens, part of the company’s Weekly Reader Publishing Group, became a non-core business when Reader’s Digest executives opted to focus on the core Weekly Reader brand.