National Enquirer is expected to be sold as the parent company faces pressure
Sarah Ellison
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Marc Fisher
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US media Inc. is actively seeking to sell the National Enquirer, according to three people familiar with the process that spoke on condition of anonymity because they were not authorized to speak publicly.
The decision to sell came after the hedge fund leader whose US media has been heavily pressured due to Forunder's efforts to tilt the presidential election in 2016 in favor of Donald Trump, a former friend of American Media's president and CEO, David Pecker . Pecker and his supermarket tabloid have also been embroiled in recent months in an unusual public feud by Jeff Bezos, who also owns The Washington Post.
In August, just like AMI and two of its top officers completed a non-persecution agreement with federal investigators, the company's board began looking for ways to relieve the tabloid business "because they didn't want to handle issues like this anymore," "another person said.
The company also had financial problems as it attempted to refinance more than $ 400 million in debt earlier this year, and as the Enquirer circulation continued to fall, along with wider newsstand trends. The paper sold an average of 516,000 copies per edition in 2014, but it dropped to 218,000 in December, according to data prepared by the Alliance for Revised Media.
American media became "very, very lifted" and repeatedly found themselves "on the verge," Pecker told the Toronto star in 2016. Pecker managed the company's financial trends by expanding American Media's portfolio in recent years, and bought magazines like Us Weekly and In Touch He has also been backed by Anthony Melchiorre, who controls the $ 4 billion hedge fund Chatham Asset Management, which holds an 80 percent stake in the author's parent company.
The decision to sell the tabloid in part is due to pressure by Melchiorre, according to two of the people who are familiar with the discussions, was motivated partly by the financial difficulties of the tabloid industry, but also by his distastiest for Enquirer's tactics, a Chatham representative refused to comment, and Melchiorre did not respond on a conversation seeking comment
The tabloid has long been known for its dubious methods; in 1977 it published a picture of Elvis Pre sley's body on the front and sold nearly 7 million copies. In 2007, in possibly his highest journalistic achievement, it broke the news of former presidential candidate John Edward's extra-marital affair with Rielle Hunter, partly by having his journalists hid in the bushes to gather evidence.
Longtime eggs Generoso Pope Jr. & # 39; s family sold the paper to Pecker in 1999. The tabloid represents a corner of the media landscape almost ignored by coastal elites, and it has long provided eagerly positive coverage of Donald Trump, along with other celebrities known within the Enquirer newsroom as "friends of Pecker." 19659012] And Trump returned praise. He once tweeted that Pecker was going to run Time magazine; He also said that Enquirer deserved to win the Pulitzer Prize.
But the Enquirer's political coverage of Trump during the 2016 election put the tabloid on much higher profile and put it in legal danger.
The upcoming sale removes the query from Pecker's control and sets some distinction between the tabloids and the latest scandals that come in part from Pecker's close relationship with Trump.
Last year, American Media recognized paying $ 150,000 to former Playboy model Karen McDougal, who claimed an affair with Trump, to prevent her claim "from influencing the election." The admission came as federal prosecutors announced that they would not charge the company for their role in the scheme to favor Trump in the presidential election.
In the agreement, AMI said it would work with prosecutors. The deal, which was hit in September, included Pecker and the company's chief owner, Dylan Howard, according to people familiar with it.
Just as the non-prosecution authorities were completed in August, AMI's board agreed to explore a sale.
So in January, Pecker and Enquirer dedicated the cover and 12 pages of their January 28 issue to an exhibition of Bezo's affair with Lauren Sanchez, formerly host of Fox's "So You Think You Can Dance". [19659020] Bezos later wrote a blog post accusing AMI of trying to extort him by threatening to publish explicit images of the billionaire if he did not announce that he had no basis to suggest that the questionnaire's exposure was politically motivated. The Bezos story helped seal the author's destiny, a person informed about his thinking.
"The trump thing was a problem, and [Melchiorre] was really disgusted by Bezos reporting," the person said.
The Bezos also reports threatened to renew legal investigation on the company. Federal prosecutors have accused Bezos of deciding whether American Media may have violated the terms of a non-persecution agreement, according to people familiar with the case.
In a draft release of AMI's announcement of the sale reviewed by The Washington Post, Pecker wrote: "Our board has been strongly focused on leveraging the popularity of our celebrity shine, youth and active lifestyle while developing new and robust platforms … now delivering significant revenue streams. Because of this focus, we feel future opportunities with the tabloids being best exploited by another ownership. "
American Media is also investigating the sale of two other tabloids, Globe and National Examiner. But it is Enquirer who has been the focus of the board and is the main title that has landed both American Media and Pecker in legal issues.
Bezos security consultant, Gavin de Becker, claimed in a poll on the Daily Beast last month that AMI was "in the league with a foreign nation who has actively tried to hurt US citizens and businesses, including the owner of the Washington Post." De Becker said his "investigators and several experts were confidently assured that Saudis had access to Bezos & # 39; phone and received private information."
The security consultant said the Saudi government "had intended to hurt Jeff Bezos since last October, when the post began its relentless coverage of "the killing of its editorial contributor Jamal Khashoggi in Istanbul. De Becker accused the Enquirer of "trying to strengthen an American citizen as the country's leadership wanted to injure, compromise and chalk."
AMI has denied that any "third party" was involved in the reporting of Bezos. The company said the only source of information on the extra-maritime affair was Michael Sanchez, Lauren's brother.
A Saudi official said the government had not tapped into Bezo's phone and played no part in the author's reporting of the Amazon founder.
The tough track of claims about the Bezos story also comes into the Trump administration. De Becker claimed that Enquirer "became an enforcement of Trump's presidential campaign and presidency", for example, by paying McDougal and then not publishing its history.
One of those who was familiar with the negotiations to sell Enquirer, said that AMI's biggest investors had become very uncomfortable with their investment in a tabloid involved in supporting the president's administration and re-election.
"The president is mate with Pecker and tries to help him, and Pecker does what he can to help the president," said the person. "It can be embarrassing."