Tuesday, February 22, 2011

BBC to buy out Lonely Planet

BBC Worldwide to pay £42m to complete controversial purchase of travel guide publisher Lonely Planet

Mark Sweney guardian.co.uk, Friday 18 February 2011

From hippie backpackers to multimillionaires ... Lonely Planet founders Maureen and Tony Wheeler.

BBC Worldwide is paying A$67.2m (£42.1m) to acquire the 25% of travel guide publisher Lonely Planet that it does not already own.

Tony and Maureen Wheeler, who co-founded the Australian travel publisher in 1973, have exercised a put option on their remaining stake as agreed when the controversial deal for the BBC's commercial arm to buy 75% of the company was struck in 2007.

"The put option enabled us to benefit from the Wheelers' experience over the last three and a half years," said Marcus Arthur, chairman of Lonely Planet and managing director of BBC Worldwide's global brands division. "They have supported Lonely Planet's ongoing migration from a traditional book publisher to a multi-platform brand."

In October 2007, the corporation acquired a 75% stake in Lonely Planet for £88.1m, a move that sparked widespread criticism from rival media companies – including Tony Elliott's Time Out and Guardian Media Group, which publishes MediaGuardian.co.uk – that it was going well beyond its remit of focusing on exploiting BBC programmes or content.

While senior management has always defended the decision to buy Lonely Planet, the acquisition resulted in the BBC Trust ruling that the corporation's commercial arm must not undertake similar acquisitions in the future unless there are "exceptional circumstances".BBC Worldwide has grown the Lonely Planet business significantly following a difficult time after the acquisition when poor trading conditions led the operation to report a £3.2m loss in the year to the end of March 2009.

Full story at The Guardian.

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