I take pride in the various keepsakes that adorn my Midtown Manhattan office. There’s the typical array of Lucite deal toys, as well as a plastic replica of a 47-pound king salmon that I once caught in Alaska.
My favorite piece of memorabilia, though, is the scrap of paper on which I scribbled the original deal terms for the sale of Reiman Publishing to Reader’s Digest Association in 2002, a transaction hatched over lunch at the Four Seasons in New York. The experience still means a lot, because it united all the components of my incongruous career — publishing, direct marketing, dealmaking — with one big idea.
I never thought I would end up in this game. After graduating from Wesleyan in 1975 with a degree in English and theater, I accepted a job as an editorial assistant (a glorified secretary, in other words) at a large book-publishing company. My starting salary: $7,500.
In 1982, following a series of editorial positions at various publishers, I joined the corporate-development group at American Express Publishing, where I was immersed in the world of catalogs and direct marketing. A decade later, having learned the ropes under my boss, Tom Ryder (a man widely considered the best in the business), and having had a hand in a number of acquisitions within that space, I created an advisory firm to serve direct marketers and specialty publishers.
In 1998, my firm advised Madison Dearborn Partners on its $630 million acquisition of privately held Reiman Publishing, based in Greendale, Wisconsin. With its numerous titles — Taste of Home and Country Woman, to name two — and a combined circulation of around 16 million, Reiman was an exciting business with great potential, and my firm continued to work with MDP on growth strategies. We helped Reiman monetize its huge customer base, which had grown to 32 million subscribers, selling numerous items via direct mail. The rest of the market saw Reiman as just another niche publishing company; I saw it as a great direct-marketing machine.
In the summer of 2001, I dialed up Tom Ryder, who by then was CEO of Reader’s Digest Association, and asked him to lunch. My agenda was to kick around some ideas and maybe get him thinking about Reiman; I couldn’t have envisioned what happened next. As Tom finished his entree and tried to persuade me to join him in dessert, I took a chance and tossed him something more tantalizing to chew on: “You should really own Reiman.”
“You know what?” he said. “Investment bankers pitch me ideas all day, and that’s the best I’ve heard yet.”
We officially put the deal in motion — but not without some, er, indigestion. Activist hedge fund Highfields Capital, an owner of significant RDA stock, objected to the planned purchase, arguing that the company’s cash would be better used buying back stock. Highfields proved a fly in the soup, putting together an eleventh-hour bid to buy a controlling stake, but it ultimately failed to scuttle the deal, which closed in May 2002. The final tab: $760 million. The Reiman acquisition really helped spice up profits. Taste of Home, for example, now has 3.5 million subscribers alone and has expanded into cookbooks.
I still can’t believe I’m in the dealmaking game. Whenever I try to figure out how the twists and turns of my unconventional career path led me here, I look across my desk at the scribbles on that little piece of paper — and then it all makes perfect sense.
