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Condé Nast Owners to Receive $1.4 Billion Windfall From Reddit| GuyWhoKnowsThings


The Internet has not been kind to Condé Nast, the publisher of stellar magazines such as Vogue and Vanity Fair, whose fortunes and influence have waned in the digital age.

But although the network takes, sometimes it also gives.

The Newhouse family, the media dynasty that controls Condé Nast through its holding company, Advance Publications, will score a windfall of about $1.4 billion on Thursday when the social site Reddit is listed on the New York Stock Exchange. Condé Nast acquired Reddit for just $10 million in 2006.

With its anarchic culture of amateur commentators, Reddit is a far cry from the meticulously curated guides to high life in the Condé Nast stable. But its public offering will reward an early and prescient bet on the company by the Newhouses, who own about a third of the outstanding shares.

Advance, which also has major stakes in Charter Communications and Warner Bros. Discovery, among other investments, is privately held and its finances are closely watched. It's unclear whether Condé Nast itself would benefit from Reddit's stock value; Representatives declined to comment. Both Charter and Warner Bros. have seen significant declines in their stock prices over the past year.

Advance is subject to a six-month lockup period during which it cannot sell its more than 42 million Reddit shares.

Condé Nast, like many other media organizations, recently announced a round of layoffs, and more cuts are expected after the company resolves a dispute with its union. In January, the company moved Pitchfork, the hipster music magazine, under the auspices of GQ. Chief Executive Roger Lynch said this month that revenue in 2023 was flat from a year earlier, partly blaming a tough advertising market.

Advance created Reddit in 2011 and one of the website's founders, Alexis Ohanian, later accredited to the Newhouses for providing Reddit “a ridiculous level of autonomy.”

In a sense, the Newhouses' potential windfall is in line with a business strategy established by the family's patriarch, Samuel I. Newhouse, a real-life Horatio Alger who rose from poverty to create one of the dynasties. richest media outlets in the country. Newhouse, who founded Advance in 1922, was an early distressed asset specialist, buying distressed newspapers at discounted prices and turning them into profit generators.

Condé Nast itself was a grand dame in decline when Newhouse bought the publisher in 1959, sensing an opportunity in fashion magazines.

Robert A. Sauerberg Jr., the former chief executive of Condé Nast who remains on Reddit's board, also owns nearly 50,000 shares of the technology company, according to public filings. His stake would potentially be worth $1.6 million below the $34 per share price target.

Katie Robertson contributed reports.


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