BusinessWeek Explains Why BusinessWeek Is for Sale: It's a Money Pit

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Earlier this year, a top BusinessWeek editor assured me that McGraw-Hill (MHP) wouldn’t part with the publication, because even if it was losing money it was still a trophy asset for the publisher. But perhaps my source didn’t comprehend how much money his employer was actually losing.

Now we know. BusinessWeek’s Jon Fine talks to people who have seen the black book for BusinessWeek, which McGraw-Hill has indeed put on the block. The numbers are brutal. Fine:

The data state that BusinessWeek lost around $20 million on revenues of $147 million in 2008, and that slightly smaller losses are projected in 2009 on revenue of around $135 million. These losses do not, however, include key corporate overhead items, such as rent and certain infrastructure-related costs. When all those items are factored in, the total loss figure essentially doubles, said two executives who saw the data.

Not surprisingly, those numbers seem to have scared off every traditional publisher that might be a logical buyer. The list of non-acquirers includes Time Warner’s Time Inc (NYSE:TWX), News Corp. (NASDAQ:NWS) (which owns AllThingsD), Bloomberg and Thomson-Reuters (NYSE:TRI).

So who does want this thing? Fine suggests that Open Gate Capital, the PE firm that bought TV Guide for $1 plus debt last year, may be up for a similar transaction. Another possibility: Billionaire Bruce Wasserstein, who’s already shown a penchant for high profile properties, like New York magazine.

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