Big changes at the Wine Advocate- Parker reportedly cashes out and gives up editorial control

[ToddFrench]

@Ken V

Todd, get any big time offers for Berserkers yet? Investors are all sheep. First they will try to buy the Spectator, then I bet they will come for Berserkers ahead of the Wine Enthusiast!

Someone offered me $100 for the domain name many months ago - I wonder if Goldman Sachs was behind it??

[Ken_V]

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

Neal wrote “I had a chat with Bob on Friday and I have to say, I am very excited about the plans for the TWA.”

No word from Antonio yet. To me, that is the big issue. If he goes back out on his own, I will switch my subscription dollars there. So Antonio, if you are reading here . . .

- YouTube

[John_Morris]

@Andrew Hall

@John Morris

…And they’d have to pay him for the business – say $4 million (1x revenue). They’ll want a return on that investment. A 20% projected return (quite plausible for this kind of expansion capital investment) would be $900,000, or almost all the rest of the profit. .

While typical for buying a business, not so for buying a brand. I suspect the purchasers are paying (and Parker would expect to be paid) on the value that can be gained from the brand. It sounds from the get-go they are looking at expansion in ways RP didn’t which would be consistent with this approach.

I think it is very smart. The potential market for the WA brand in the US is not growing and with all the specialist venues and free information, the markets segments are really just fighting over the same shrinking pie. Porting the brand in a significant way to a growing market could be extremely profitable.

A.

That was the point I was trying to make. It’s hard to get to a price that’s materially better for Parker than the current arrangement unless you have a new vision for the business/brand that will see a bit increase in the top line.

[Russell_Faulkner]

So did Mr Parker cash out just before tax rates jump? Good for him!

[Peter_Chiu]

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

Kevin… if I have to guess :

[Ian_Fitzsimmons]

@Todd F r e n c h

[…] I doubt they will focus too much on Asia, but certainly more than it has recently […]

In any event, they will be positioned to grow with this regional market, as its already-increasing affluence multiplies. All those Chinese foreign exchange reserves chasing assets.

Still, RMP was able to cash out of a business that was in decline (based on subscription count estimates only) and likely for a sick amount of money, while still staying on board as a paid Chairman. Smart.

The WA founder got mad at me a few years ago, when I wrote that he was a good businessman. Methinks he did protest too much.

[SteveC]

@Brad Kane

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

There had been talk the past couple of years that Antonio had purchased an ownership stake and that the original “plan” was that he was eventually going to take over the Wine Advocate. Sounds like he may have been out maneuvered, or cashed out. One has to wonder at this point what future role, if any, he may have.

I would very much guess that he was out-maneuvered. I am sure that AG is a very unhappy camper at the moment, unless he got handsomely rewarded for his minority stake in the business, which is unlikely.

[John_Morris]

Remember, he was a banker, so he should understand the notion that the highest bidder wins.

[Bob_Wood]

Enough about Parker! There, I’ve provided the obligatory complaint. Carry on.

[k_s_h_i_n]

@Brad Kane

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

There had been talk the past couple of years that Antonio had purchased an ownership stake and that the original “plan” was that he was eventually going to take over the Wine Advocate. Sounds like he may have been out maneuvered, or cashed out. One has to wonder at this point what future role, if any, he may have.

That was a rumor started in NYC. I recently met him at villa d’este for the first time and he seemed quite capable. I hope he is a part of the new regime. That goes for Neal as well.

[SteveC]

@John Morris

Remember, he was a banker, so he should understand the notion that the highest bidder wins.

It doesn’t make losing a big deal that you staked your life and career on any easier.

[WvanGorp]

From the way it reads, Antonio is potentially the biggest loser in this. He has gone from “heir apparent” and seeking investors to buy out Parker to now a paid employee who will be under much greater editorial control.

[Bill_Klapp_deactivated]

@John Morris

Remember, he was a banker, so he should understand the notion that the highest bidder wins.

Pure speculation, John, but one wonders if Galloni had, in essence, an option to secure financing and cash Parker out within a certain time period and did not get the job done. Given what is publicly known of Galloni’s work and travel schedule, one would have to wonder if he had the time for dealmaking, too. This looks like the work of bankers, and perhaps driven by fiscal cliff paranoia. Interestingly, the Dragon Lady has a banker in the family, according to her bio:

“In November 2002 Perrotti-Brown left London for Tokyo, where her husband, a banker, had been transferred.”

[Bill_Klapp_deactivated]

@Kevin Shin

@Brad Kane

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

There had been talk the past couple of years that Antonio had purchased an ownership stake and that the original “plan” was that he was eventually going to take over the Wine Advocate. Sounds like he may have been out maneuvered, or cashed out. One has to wonder at this point what future role, if any, he may have.

That was a rumor started in NYC. I recently met him at villa d’este for the first time and he seemed quite capable. I hope he is a part of the new regime. That goes for Antonio as well.

Martin is part of the new enterprise:

“I’m very happy about the move, it’s exciting both for myself and The Wine Advocate,” Martin told the drinks business.

“It means we can upgrade the website, conduct more tasting events and expand the readership in the Far East,” he added.

[Russell_Faulkner]

@Kevin Shin

@Brad Kane

@Kevin Shin

I wonder how Neal and Antonio feel about this, especially Antonio.

There had been talk the past couple of years that Antonio had purchased an ownership stake and that the original “plan” was that he was eventually going to take over the Wine Advocate. Sounds like he may have been out maneuvered, or cashed out. One has to wonder at this point what future role, if any, he may have.

That was a rumor started in NYC. I recently met him at villa d’este for the first time and he seemed quite capable. I hope he is a part of the new regime. That goes for Antonio as well.

Kevin, does your first sentence refer to Neal? You needed to meet him to consider him capable? For/at what?

[Peter_Kleban]

@Bill Klapp

Ken, “nasty” should be replaced with “pissed off”. Squires seemed to indicate that he is staying on, although nobody actually asked. Martin’s post, along with his presence in Singapore recently, makes it clear that he is in. Everybody else is silent at the moment. Including Jay Miller, Pancho Campo, Rovani and Thomases. Not sure that they have offers from the Dragon Lady. Gil Lempert-Schwarz states that Goldman Sachs had a hand in this, which means that business is REALLY slow in Asia. This deal could not be worth much more to Goldman than the typical Goldman partner’s monthly wine, ho and blow budget! That I would believe. Also that P-BJ was the conduit, but did not put this deal together for herself. Is her husband a Goldmanite?

Her husband is a banker, but IIRC wasn’t with Goldman-Sachs.

[Alan_Rath]

@Russell Faulkner

Any examples of ‘franchises’ surviving the main input of those contributing to the success. Is Halliwell’s movie book still going?

Well, KFC is still doing pretty well post-Colonel

[Ken_V]

@Alan Rath

@Russell Faulkner

Any examples of ‘franchises’ surviving the main input of those contributing to the success. Is Halliwell’s movie book still going?

Well, KFC is still doing pretty well post-Colonel

What an original thought!

http://www.wineberserkers.com/forum/viewtopic.php?p=1038324#p1038324

[Peter_Kleban]

The new owners also have no experience either in wine or in publishing: Parker says that they’re “young visionaries” in the financial-services and IT fields,

Look out Eric, here comes “My Wines”…

[Alan_Rath]

@Ken V

@Alan Rath

@Russell Faulkner

Any examples of ‘franchises’ surviving the main input of those contributing to the success. Is Halliwell’s movie book still going?

Well, KFC is still doing pretty well post-Colonel

What an original thought!

Sorry Ken, hadn’t gotten that far down the thread. Great minds, and all that