A controversial ex-publisher of Sports Illustrated is teaming up with crypto mogul Brock Pierce to seize control of the embattled publication, The Post has learned.
James Heckman — who as CEO of Arena Group scooped up the iconic magazine title in 2019, only to exit a year later following layoffs that engulfed a slew of star writers — has offered roughly $4.50 a share for a 45% stake in Arena, according to a source close to the situation.
The battered stock closed at $2.09 on Wednesday.
Heckman’s bid is backed by Pierce — the child actor of “Mighty Ducks” fame who has since become a deep-pocketed crypto investor — and who is now Arena’s second-largest shareholder, sources close to the situation said.
Pierce bought $17 million worth of convertible stock in The Arena Group between 2020 and 2021 through his investment firm Warlock Partners. He is currently suing Arena for not letting him sell his stock in a timely manner, as The Post previously reported.
Heckman didn’t respond to multiple requests for comment. Pierce declined to comment. An Arena spokeswoman declined to comment.
Heckman’s purported offer comes on the heels of his successor Ross Levinsohn getting fired as Arena CEO last month following a bombshell report that SI — once home to some of the nation’s best sports journalists — was using AI to compile content.
It also comes as Arena’s board is on the cusp of approving a deal with 5-Hour Energy Drink founder Manoj Bhargava, the CEO of Simplify Inventions, for a majority stake in the the company.
Bhargava presently owns 44% of Arena through his holding company, according to a Dec. 11 public filing, and was named the SI parent’s interim CEO after Levinsohn was canned.
He signed a definitive agreement on Nov. 6 to raise his stake to what is now 80% at Arena’s current stock price with a five-year guaranteed ad commitment of $60 million from brands owned by Simplify, which includes the ShopHQ home shopping network.
Arena’s board is expected to vote on the deal in the first quarter of 2024, according to a company statement.
Heckman founded The Arena Group, formerly The Maven, in 2016. He acquired the rights to publish SI from its owner Authentic Brands Group, but was pushed out within a year over fears he was tarnishing the storied newsstand title, The Post reported at the time.
During his short-lived reign, Heckman fired close to 50 Sports Illustrated staffers — many of them senior writers who had been with the magazine for decades — and shifted the focus on breaking news in pro and college sports instead of long-form journalism, a hallmark of the publication since it was launched in 1954.
Heckman now wants to add a paywall for the currently free publications, which include SI, to increase revenue and reduce Arena’s dependency on digital ads, the source close to the situation said.
Aside from SI, Arena owns a slew of publications that include Maxim, Men’s Journal, Parade, FanNation, PetHelpful, The Spun and TheStreet.
Last year, Arena earned around $220 million in revenue, up from roughly $53 million in 2019.
Levinsohn and Heckman’s paths have crossed for nearly two decades.
From 2010 to 2012, Levinsohn was interim CEO of Yahoo at the same time as Heckman was its Global Chief Media Strategist.
The two also worked together in 2005-06 when Levinsohn was president of Fox Interactive Media and Heckman was its Chief Strategy Officer.
Credit: Source link
