The Irish rock star will make millions whenever the old guard magazine sells thanks to an investment made seven years ago that will likely reap a pretty little profit.
In 2006, private-equity firm Elevation Partners purchased a 45 percent stake in Forbes magazine, which is now for sale for the first time in the publication's 96-year history, the Forbes family announced this week. A leaked internal memo claims there are already many interested parties. Among the many wealthy persons involved with Elevation Partners is Bono, who as the front man for U2 has toured the world, sold millions of records and made enough money to fill many Olympic-sized swimming pools.
According to Fortune, Elevation paid $264 million in the deal, more than the previously reported $240 million. Elevation received most of their cut in preferred stock as part of the deal. Elevation will emerge as the major winner in an eventual Forbes sale through some creative accounting, Fortune explains:
Moreover, the deal was structured as preferred stock, meaning that Elevation would get paid back first in the event of a sale (and then share in any gains).
That provision is paramount today, given the asking price. If Forbes sells for $400 million, then minority shareholder Elevation would receive a majority of the proceeds. Not too shabby, particularly given that Elevation had written its Forbes investment down by more than 75%.
Elevation gets paid, and therefore so too does Bono. Everyone else gets paid too, of course. We're talking about hundreds of millions of dollars. There's enough to go around.
The magazine needs buyers first, though, and the Forbes family will likely look to one of the many billionaires scooping up old media vanguards as personal projects lately. Jeff Bezos bought the Washington Post for $250 million. The Boston Globe sold to Red Sox owner John Henry in exchange for a whisp of David Ortiz's hair. But no one has yet lined up to be the billionaire Prince Charming to Forbes' Cinderella. Maybe a certain billionaire mayor leaving office who has received some flattering coverage lately will cast his frisky media-focused eye this way.
This article is from the archive of our partner The Wire.
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