Baltimore magazine staff told of sale rumors

October 11, 1994|By Timothy J. Mullaney | Timothy J. Mullaney,Sun Staff Writer

CLARIFICATION

An article published in the Business section of Tuesday's editions of The Sun may have given the incorrect impression that the level of advertising in Baltimore magazine has fallen.

In fact, advertising at the magazine has increased in recent years. Overall advertising pages were up 18.4 percent at the magazine through June, according to Baltimore publisher Jonathan Witty.

The editor of Baltimore magazine told members of the staff yesterday that there were strong rumors that the owners of the 50,000 circulation publication could agree to sell the magazine to Diamond Comic Distributors Inc. owner Steven Geppi by the end of this week.

Editor Ramsey Flynn said he put the magazine's possible sale on the meeting agenda after being "assaulted" with questions at a civic function over the weekend, so that the staff would not learn of such a major change from news leaks.

But in an interview yesterday, he said he did not have any inside information on whether the deal would occur.

Mr. Geppi said in June that he wanted to buy the magazine, but that he and current lead owner Susan Souders Obrecht were far apart in negotiations. Yesterday, Mr. Geppi's lawyer, George Stamas, declined to comment. Phone calls placed to Ms. Obrecht were not returned.

Baltimore Publisher Jonathan Witty said yesterday that no deal has been reached.

A deal to sell the magazine, if it occurred, would close out the two-year tenure of Ms. Obrecht, whose ESS Ventures Inc. bought the magazine from Washingtonian magazine owner Philip Merrill for nearly $4 million.

A number of executives familiar with the magazine expect Ms. Obrecht and backers who include Baltimore venture capitalist Frank Bonsal, W. B. Doner & Co. Chairman Herb Fried and a mutual fund of T. Rowe Price Associates Inc. to take a substantial loss on the investment.

"If this guy . . . [pays] anything more than half a million dollars for Baltimore Magazine, I would have to question it," said Towson attorney and radio station owner Michael Hodes, who dropped out of negotiations for the magazine and its sister publication, Mid-Atlantic Country, because, he said, the Obrecht group wanted far too much money.

Mid-Atlantic Country Publisher Laurin Ensslin said she does not believe the Greenbelt-based lifestyle magazine was part of any contemplated deal.

Mr. Witty, the magazine's publisher, said Baltimore magazine makes money on operations. But he would not comment on whether the profit was big enough to service debt remaining from the 1992 sale.

"Let's just say we're profitable," he said.

The Obrecht group took over Baltimore magazine with plans to boost its value by upgrading its editorial content. Ms. Obrecht said at the time that she hoped to use the two magazines as the base for a larger communications business.

But the combination of the high purchase price and a stubborn advertising recession led to a 40 percent editorial staff cut at Baltimore magazine last year, reducing the full-time editorial staff to five people.

"I think the fall issues demonstrate that we are regaining our vitality," Mr. Flynn said. "I'm hopeful that most of the existing staff will do well under such a change."

Despite a stable circulation, the magazine has also been hurt by stiff competition from Style, a publication of the Baltimore Jewish Times, and Distinction, published by The Baltimore Sun Co.

Further, executives at similar publications question whether the Baltimore market is big enough to sustain a city magazine, a category of publications that has come under increasing pressure as the 1990-1991 recession has compelled advertisers to cut back nationally.

"Style kills her," Mr. Hodes said. "There's way too much competition. You have Maryland magazine, Style and Baltimore all vying for a very similar population. What someone should do is own all three."

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