Hearst seals rights to Elle with €661m magazine deal

The publishing giant that owns Esquire and Cosmopolitan magazines has agreed to pay €661m (£566m) for a series of titles from French conglomerate Lagardère, which will bring Elle into its stable.

Hearst Corporation, which traces its roots back 120 years, announced the binding offer for Lagardère's international press and magazine businesses yesterday.

The deal, which follows a month of exclusive talks, will bring Hearst 102 titles across 15 countries including the UK and the US. It is expected to close by the autumn following regulatory approvals.

The deal will hand it the rights to publish Elle in those 15 countries, which also include Italy, Russia, Mexico and China. Lagardère will retain French Elle, and will continue to collect royalties from the international counterparts, estimated at about €8m a year. In the UK, the publisher will also take control of the fashion, health and beauty magazine Red as well as Inside Soap and Psychologies.

The sale comes after Lagardère, whose publications include Paris Match, moved to tighten its focus. Its chief executive, Arnaud Lagardère, said the downturn in advertising had put pressure on a business that was struggling to compete, especially in the US. The company is increasingly looking to focus on sports marketing.

The magazines that form part of the deal brought in revenues of €774m last year, with profits of €37.7m. The deal will make Hearst the second largest publisher in the US in terms of circulation.

The genesis of the publisher can be traced to 1887 when William Randolph Hearst bought the San Francisco Examiner. By 1930 he had built the largest newspaper chain in the nation. He was also the basis of Orson Welles's newspaper baron in Citizen Kane.