The BBC’s commercial arm has sold its Lonely Planet travel publishing guide for £51.5m, £80m less than it paid for company.
BBC Worldwide bought 75% of Lonely Planet in 2007 for £88.1m and four years later paid a further £42.17m for the remaining 25%.
The acquisition was hugely controversial with rival publishers as the company had no connection with the BBC’s TV or radio output. Historically the BBC’s commercial activities were based around commercialising hit shows such as Doctor Who and Top Gear.
Defending the sales price, BBC Worldwide said: “During the time BBC Worldwide has owned Lonely Planet its annual revenue has grown from £810m in 2007 to £1.08bn in 2012 – with profit increasing from £111m in 2007 to £155m in 2012.”
The company has been sold to NC2 Media, following approval from the BBC Trust.
Diane Coyle, vice chairman of the BBC Trust and chair of the Strategic Approvals Committee, said: “The Trust’s strategy for Worldwide now is to focus on BBC programme content, and Worldwide would not make this sort of acquisition again. Although this did not prove to be a good commercial investment, Worldwide is a very successful business; and at the time of purchase there was a credible rationale for this deal.
“Given the significant financial loss to Worldwide, however, we have asked the BBC Executive to commission a review of lessons learnt and report to the Trust with its findings.”
Announcing the sale, Paul Dempsey, Interim CEO BBC Worldwide, said: “We acquired Lonely Planet in 2007 when both our strategy and the market conditions were quite different.
“Since then, Lonely Planet has increased its presence in digital, magazine publishing and emerging markets whilst also growing its global market share, despite difficult economic conditions. However, we have also recognised that it no longer fits with our plans to put BBC brands at the heart of our business and have decided to sell the company to NC2 Media who are better placed to build and invest in the business.”
NC2 Media’s Daniel Houghton added: “The challenge and promise before us is to marry the world’s greatest travel information and guidebook company with the limitless potential of 21st century digital technology.
“If we can do this, and I believe we can, we can build a business that, while remaining true to the things that made Lonely Planet great in the past, promises to make it even greater in the future.”