Updated: It’s hard not to see the symmetry: two deals announced within 24 hours of each other, closed on the same day. McGraw-Hill (NYSE: MHP) claims a pre-tax gain of $9 million from selling 80-year-old BusinessWeek to Bloomberg, while financial commentary start-up Breakingviews sells to Thomson Reuters (NYSE: TRI) for just under $20 million. (Another source tells me the price was £12.5 million, which would be closer to $20.7 million at today’s exchange rate.) McGraw-Hill liked having a flagship brand but didn’t want to pay for it anymore; Reuters has grand ambitions for commentary as a brand — and was willing to pay lots for it rather than wait for its DIY version. It’s also willing to keep investing, which is why U.S. Editor Rob Cox spent his last afternoon at BreakingViews’ “quaint” Park and 34th offices Tuesday and will report to 3 Times Square Wednesday in the same role at Reuters Breakingviews. He spoke with paidContent about the sale; plans for the unit, which will be led by Breakingviews E-i-C Hugo Dixon; and how Dow Jones (NYSE: NWS) might spend its proceeds from the sale.
– On the sale: Cox describes Reuters Commentary as a beta of sorts and Breakingviews as the shortcut. “They wanted to get there very fast. We have a process that works, a proven methodology and a brand that signifies something separate from news.” Breakingviews also had significant relationships in place: The New York Times, Le Monde, the National Post, the Telegraph. What Breakgviews didn’t have was the clout to go much further selling its own content. “We just weren’t able to do that. That’s why we sold the business. The editorial process is going to be the same.” He added later: “We needed to be part of a broader suite.” The Reuters Trust Principles also “guarantee a certain amount of independence.”
– On a three-year plan: The deal doesn’t include an earnout but Cox says they’re on a “three-year plan.” He didn’t go into details but according to one source, Reuters is paying the BreakingViews team £3 million (nearly $5 million) in retention bonuses with Dixon getting roughly half and Cox about £750,000 ($1.2 million).
– On WSJ: The Journal hasn’t run Breakingviews columns for more than a year but despite plans to sell, I’m told Dow Jones still had its equity stake when the Reuters sale went through. A DJ spokesman says the company’s stake was less than 10 percent and confirmed a sale but couldn’t confirm it was today. I was told the stake was about 6 percent. Either way, it looks like WSJ came out with more than $1 million from Reuters. Cox couldn’t resist: “It’s a nice bonus. They can put a little money into ‘Heard on the street’ to try to keep up because we are now 30 people around the world.” Later when we were talking about business models, Cox added: “I shudder to think what Dow Jones on its own would look like today.”
– On staffing: Bloomberg cut staff at BW but RBV is staying intact and hiring. Combining Breakingviews’ dozen staffers with the Reuters Commentary staff will double the wire service’s opinion staff to start; plans call a bout 30 in all with staffing Tokyo, Dubai, Mumbai and Frankfurt and adding in Hong Kong, Moscow and DC. Dixon will report to Reuters E-i-C David Schlesinger. But the Reuters staff isn’t staying intact — we’ve learned that </Tuesday was Jonathan Ford's last day, roughly a year after the Breakingviews cofounder and former deputy editor joined as Reuters commentary editor to create the group. Jeff Cane, the U.S. commentary editor, is being reassigned and financial blogger Felix Salmon is now working with Reuters.com. Matthew Goldstein has already shifted to Wall Street investigative reporter, according to Gorkana.
– On Bloomberg: Breakingviews hasn’t done one of its trademark 350-word pieces on Bloomberg-BW. Cox pointed to the way the deals show “the relative valuations on new media versus traditional media.” As for what Bloomberg wants, “I don