While Charles McCurdy’s management and investment firm Apprise Media LLC has only been operating for less than a year, McCurdy has experienced both the good and the bad of private equity from the last two decades. First hand, McCurdy has witnessed the hostile takeover days of the ’80s, the ambitious rollup trend in the ’90s and the friendlier and more deliberate buy-and-build strategies employed today.
McCurdy got his start out of Columbia Business School with Macmillan, Inc., a diversified publishing company, where he worked in the acquisitions group. There he focused on building the company with select acquisitions, until Macmillan itself was the target of a Robert Bass hostile takeover attempt. “At the time, in 1988, we had really built up Macmillan, and the company was doing very well, but it was broadly held by the public,” McCurdy says. “It was the tone of the times back then, and Macmillan was an attractive target, so we went from focusing on growing the business do dealing with this hostile takeover.”
In the scrum for Macmillan, while Robert Bass and English publishing tycoon Robert Maxwell battled publicly for the company, Kohlberg Kravis Roberts & Co., behind the scenes, had a deal on the table to buy the business in a management buyout. Ultimately, though, that deal was scuttled after Robert Maxwell took on KKR’s offer and eventually ended up buying Macmillan for $2.6 billion, calling the purchase a “Victory for Britain.”
While KKR did not end up with the target, the firm did poach McCurdy from the company, and went to work with him on building its own diversified publishing platform, K-III Communications Corp., known today as Primedia. “We started the company in 1989,” McCurdy says, “and one of the first companies we acquired was Macmillan’s book club.”
Even as investors these days recognize Primedia as a company that has been divesting assets at rapid clip, back then, during McCurdy’s first few years with the business, Primedia was clearly a buyer. “The basic strategy for us was to find strong platforms in attractive niches and build from there. The buildup phase up until 1996 was very productive. We carried out a consistent strategy across both the consumer niche sectors and the business-to-business sectors,” McCurdy says.
Indeed, starting from scratch under McCurdy’s stewardship, along with CEO Bill Reilly and Chairman Beverly Chell, Primedia grew to $1.5 billion in revenue and an EBITDA of $250 million. As president, McCurdy led the purchase of more than 15 operating platforms at Primedia and more than 100 product groups, and in 1995 helped lead the company to the public markets in an IPO that valued Primedia at $1.4 billion.
While success at Primedia came quickly, the company ran into some problems when its expansion led the publishing house onto the melting surface of the Internet icecap. After naming NBC Veteran Tom Rogers as the successor to the retiring Reilly, Primedia trumpeted his hiring as the first move to signify their push into “new media,” and the company quickly followed with a $690 million acquisition of About.com.
Given the benefit of hindsight, it’s easy to see why Tom Rogers did not succeed. He was let go from Primedia in April of last year, and following Roger’s departure, McCurdy was named the interim CEO. Working in rewind, McCurdy led what he termed the “reset” program at Primedia, where he eliminated over $100 million in fixed expenses and divested $600 million worth of non-core assets. McCurdy led the sales of such names as Modern Bride, Chicago, American Baby, Seventeen and the widely discussed divestiture of New York.
In October, Primedia tapped Kelly Conlin, formerly of International Data Group, as the permanent successor to Rogers, and with that McCurdy left to pursue other options. “I was very excited about where Primedia was. I thought we had turned the company around and put it back on good operational footing,” McCurdy says, adding, “I was excited about taking Primedia forward.”
However, despite being overlooked, McCurdy is not bitter. Since leaving Primedia, he opened up Apprise Media LLC, a management and investment firm, and already, he has worked out a deal in which Apprise will partner up with Spectrum Equity Investors on a niche media and publishing platform. Spectrum will commit between $175 million and $200 million, and McCurdy will head the business as Chairman and CEO.
“In this platform, my role is to manage and lead the businesses we acquire,” McCurdy says. “Since we’ve yet to acquire any businesses, I’m currently working on a prospecting and valuation role right now.”
While McCurdy has seen both the peaks and valleys of publishing, he feels right now the industry is finally stable. “We’re not ready to say that we’re seeing growth, yet, but after years of decline, stability is a good thing. There’s a greater confidence from the advertisers, right now.”
Under the partnership with Spectrum, McCurdy feels comfortable. “These guys have a history in building media companies and are very savvy in the space. We believe there is going to be a variety of acquisition opportunities, and I’m really excited about working with Spectrum.”