While it follows signs of digital growth at Forbes Media, best known for its rankings of wealthy individuals, a sale for an estimated USD 400 million to USD 500 million still amounts to an acknowledgement by its founding family, that a traditional publishing business is a tough one to turn around.

Chief executive Mike Perlis, in a memo to employees on Friday, said the company had hired Deutsche Bank to explore a sale of the company founded by financial newspaper columnist BC Forbes in 1917.

The move comes after years of changes for the privately held, family-controlled company that has made a push to expand its online presence and which, in 2006, sold a 45 percent stake to Elevation Partners, the private equity firm that counts U2 singer Bono as a co-founder and managing director.

A source familiar with the matter said on Friday that Forbes is hoping to fetch between USD 400 million and USD 500 million in a potential sale. The proceeds would help repay a USD 264 million investment Elevation Partners made in Forbes, which it expects to be repaid in the next several years, according to a report, citing anonymous sources. Elevation valued its stake at about USD 30 million in 2012, the newspaper said.

An outside spokesman for Elevation did not respond for a request for comment.

The move follows the decision by the Graham family earlier in 2013 to sell the Washington Post to Amazon.com founder Jeff Bezos, as well as the Bancroft family's sale of the Wall Street Journal in 2007.

Magazines have also been struggling, with Newsweek recently closing its print edition and Time Warner preparing to spin off its Time Inc unit, which includes Time Magazine, Sports Illustrated and People next year.

Perlis, the CEO, said an investment bank was hired after the company received "serious" overtures and now "expects interest from numerous suitors." A representative for Deutsche Bank declined to comment.

Forbes's online presence might make it attractive as a business brand at AOL or Yahoo, as opposed to a traditional magazine publisher, said Peter Kreisky, a former senior adviser to Time Inc and chairman of media strategy firm Kreisky Media.

Family change

A Fortune magazine article in 2011 detailed the family's financial struggles with the asset and said the company had defaulted on some of its loans. In response to the magazine article, Steve Forbes, who has campaigned unsuccessfully for the Republican presidential nomination twice, sent a note to employees in 2011 saying that "Forbes Media is profitable and in full compliance with all bank loan covenants."

But there is no doubt the company's core business has undergone upheaval as the traditional publishing industry has contracted.

Forbes Media's US advertising sales were USD 275 million in 2012, down 19 percent since 2008, according to the Publisher's Information Bureau.

In 2010, Steve Forbes and his brother Tim Forbes stepped down on the business side to make way for Perlis to become CEO and the first-ever outside executive to run the company. Steve Forbes remained editor in chief and chairman of the company and still writes a column.

About three years ago, Forbes reinvented itself as a web destination when it acquired a startup called True/Slant founded by Lewis D'Vorkin. It unveiled a new model focused on contributors, featuring more opinion pieces alongside news that gave prominence to non-journalists. Like many magazines, it has also built up a conference business.

Forbes Media now maintains that of total ad revenues, digital ad revenues now make up about 55 percent versus print at 45 percent.

"They became much more a creature of the web and learned how to master the web in ways other publishers haven't," said Outsell news industry analyst Ken Doctor.

While Forbes has seen some online success, Kreisky, the consultant, said "they've been struggling to establish a sustainable digital model as have most magazines" and noted that it has many competitors.


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