In September 1991, Robert Maxwell’s son Kevin said his father would only sell his business magazines to Emap plc "over his dead body".
Two months later, Maxwell was found dead at sea, with his once mighty media empire in ruins. And, right on cue, Emap bought Maxwell Business Communications – including Media Week – out of bankruptcy for £21 million.
Emap, which, until the year of Media Week’s launch, was known as East Midland Allied Press, was described by The Independent in 1994 as "one of the most admired media companies in the world".
It had grown, in 50 years, from humble origins as a regional newspaper publisher to a £1 billion public company. It had scaled the heady heights of the FTSE 100. By 2001, it was making pre-tax profits of £197 million and was growing by 30-40 per cent a year.
But Emap plc is no more. So what happened?
The life and times of Emap are the stuff of business-school case studies.
The story began quietly enough in the mists of 1887 when an East of England aristo MP purchased the Spalding Guardian as the first of a series of local paper deals in Northampton, Peterborough, Norfolk and Suffolk.
The single step along a path that would eventually transform the little-known publisher into a major UK company was not much more than a search for work to fill spare printing press capacity.
In 1953, this led to the launch of Angling Times and the acquisition (for £100) of Motor Cycle News. MCN went on to become the biggest single earner for most of Emap’s life. But the real game-changer was the 1978 launch of Smash Hits.
The funky fortnightly, which published lyrics of current hits, was itself an instant hit. An initial circulation of some 10,000 soared to one million within 12 months, catapulting Emap into the big league. It started creating new titles at a prodigious rate: Q, Mojo, Empire, Looks, Bliss, More and Just Seventeen followed in quick succession.
A men’s fashion magazine, For Him, was given the Emap work-over and became the worldwide franchise FHM in the booming young-men’s market, selling almost one million copies along the way. In the women’s market, Emap launched Red and revitalised weeklies with the huge-selling Heat, Closer and Grazia.
After years of relatively few new major magazines across the UK, Emap showed the power of innovation to create new growth. Even Heat, which initially bombed when launched as a men’s entertainment title, spun round to become the UK’s most profitable women’s weekly. But consumer magazines were only part of the story.
Emap kept on making industry-best profit margins from its regional newspapers before selling them in 1996 for £200 million, virtually at the top of the market.
In 1991, it predicted that commercial radio (then a struggling medium with only 2 per cent of UK adspend) was set to grow and went about snaffling regional franchises in Liverpool, Manchester, Leeds, Newcastle and London. Within a few years, radio’s ad share had soared to 6 per cent and, with it, Emap’s earnings from major brands such as Magic and Kiss FM.
The high-flying company – which had published computer magazines before most people had PCs and websites when few had even heard of the internet – went on a B2B spending spree. Acquisition of the bankrupt Maxwell Business Communications was followed by deals with International Thomson and Maclean Hunter.
By the mid-90s, Emap’s Business Communications division was becoming a B2B industry leader. Everything was bubbling nicely in the company nicknamed "Every meeting a party" by sniffy competitors. It was the place where everyone in media wanted to work.
But not everything at Emap was quite so cheerful.
That 1994 Independent interview was prescient: "They may be the odd couple of business but… Emap’s chiefs are happy to keep on arguing in the boardroom." The "odd couple" was Robin Miller and David Arculus, respectively the chief executive and group managing director – the two men who had driven the company forward for more than 20 years.
'Everything was bubbling nicely in
the company nicknamed ‘Every meeting
a party’ by sniffy competitors. It was
the place where everyone in media
wanted to work…'
It was an inspired partnership, brought together by Sir Frank Rogers, the former head of IPC – the company that had swallowed up (as part of the Daily Mirror group) most of the long-time big beasts of the UK magazine jungle. IPC was a huge, centralised and slow-moving monolith, which journalists labelled "the Ministry of Magazines".
He came out of retirement to join Emap in 1970, determined to build the opposite: an agile, fast-moving, decentralised business – and picked Miller and Arculus to build the media company with a difference.
Rogers stepped down as chairman of Emap in 1990, having presided over the transformation of a £200,000 provincial newspaper company into a £2 billion magazines powerhouse.
The protracted search for his successor culminated in the appointment of Sir John Hoskyns, a former army officer and policy advisor to Margaret Thatcher. The serious, disciplined military man simply found the Miller-Arculus sparring too much to take.
Then, things got worse. Arculus left in 1997 after 24 years to join Clive Hollick’s United News & Media Group before becoming the chairman of IPC.
In July 1998, Miller succeeded Hoskyns as chairman. The new chief executive was Kevin Hand, who had led Emap’s consumer magazines in the UK and France.
Now, he was a man in a hurry. In December 1998, just four months into the role, Hand decided to conquer America. He paid a breathtaking $1.2 billion for the newly floated Petersen Publishing, whose titles included Guns & Ammo and Hot Rod. The price tag was: a 45 per cent premium to the Petersen share price; three times that paid for the business two years earlier; and equivalent to more than 50 per cent of Emap’s own market value.
The new chief executive was suitably bullish: "This is a deal that Emap has dreamed of doing. Together, we want to become the biggest specialist publisher in the world."
But it was a loss-making disaster, which Emap owned up to when it sold on its fateful US company for less than half of what it had paid three years before. It cost Hand his job. He was succeeded in 2003 by his long-time deputy, Tom Moloney. But not for long. Emap was still sagging under the Petersen debt, and spluttering growth prompted a break-up auction.
Against all the odds, the sell-off was an astonishing success, with Emap plc securing a £2 billion payday for its disillusioned investors. But it was the sad end of a brilliant media story, and left nostalgic Emap people feeling: "If you were there, enough said. If you weren’t there, enough can never be said."
Colin Morrison is a former chairman of Emap Business Communications