BBC Sells Lonely Planet to NC2 Media

BBC Worldwide announced that they would sell their majority stake in Lonely Planet to NC2 Media. The reported selling price is $77.8 million, which is a huge loss compared to the $120 million they paid for it starting in 2007. The buyer, NC2 Media is majority-owned by environmental conservationist Brad M. Kelley who also happens to be one of the largest private landowners in the United States.

NC2 Media to Keep Lonely Planet for Content

The sale is particularly unique on many levels. Kelley sold cheap cigarette brands like Bull Durham, USA Gold and Malibu. He sold his tobacco business for $1 billion, and used the money to become one of the biggest private conservationist and largest landowners in the U.S. Wall Street Journal ranked him as being the fourth largest U.S landowner,while other estimates say that he could be the second or the third largest landowner.

NC2 Media is a startup which is focused on Internet content. Besides NC2, Kelley is also an investor of an Internet company called OutWild TV which shows documentary videos of travel journalists. Outwild founder and principal Daniel Houghton and another principal, Michael Rosenblum are now with NC2 Media. Houghton is the Executive Director of NC2, and along with Rosenblum were the point persons during the negotiations with BBC. It has been reported that Houghton will most likely be Lonely Planet’s CEO after the sale has been finalized.

Regarding the sale, Houghton said that the real challenge for the acquisition is to merge Lonely Planet with the promise of 21st century technology. To that purpose, Kelley said that the NC2 would continue to invest in Lonely Planet. Houghton considers the purchase to come with the brand recall which translates to a global footprint in the travel guide, book and magazine publishing and in the digital space. It is possible that the purchase will be used for the long-term value of the brand which can lead to offline retail as well as for use as a platform for environmental conservation.

As a businessman, Kelley makes acquisitions based on based on long-term values, thinking about these in a thorough manner, is not into vanity acquisitions, nor does he overpay.

BBC Worldwide After Sales Review

BBC Worldwide is the commercial arm of the BBC. It has received criticism for the sale and a review has been called by its governing body, the BBC Trust. BBC said that BBC Worldwide used its own operating funds in the purchase of Lonely Planet, and no public funds were lost during the transactions. However, due to the large amount of the loss, the BBC ordered a review of the sale for leassons learned.

BBC Worldwide first acquired a portion of Lonely Planet in 2007 for $143 million. It acquired the rest of the company in 2011 for an additional $67 million. Its most recent valuation of the property was $135 million. The actual numbers will not be known until after the BBC’s annual statements are released sometime after March.

BBC Worldwide was also widely criticized when it first acquired the Australian travel guide company. It has been trying to find a buyer for several years now. NC2 Media has been described as the best option for the sale.

Lonely Planet Figures

Lonely Planet was founded by Tony and Maureen Wheeler in Melbourne in 1973. It has published more than 120 million copies of travel guide books which are aimed at backpackers. The Lonely Planet website has more than 120 million visitors per year. It continues to be a good source for content and media which would be readily available for porting to the Internet.