The founders of the Lonely Planet travel writing empire have finally parted ways with the business they founded 37 years ago, selling their remaining 25% stake to Britain’s public broadcasting and media giant, BBC Worldwide for $67.2 million.
The BBC, which bought 75% of the business in October 2007 for $201.6 million, exercised an option over the remaining stake on Friday after a three year transition process that has seen the Wheelers pull back from any day-to-day involvement in the business.
“We’ve always been believers in simple rules and straightforward answers – you cannot be half pregnant, you cannot jump across a ravine in two steps – and as 25% owners we knew we would always be back seat passengers, along for the ride but no longer behind the wheel,” the duo said in an email to staff on Friday.
“Well, we’re confident about the people who are in the front seat and at the controls. It’s time for us to open the back doors and get out.”
“…Of course we feel towards Lonely Planet just the way any proud parent feels about their child. Eventually that kid is going to grow up, wave goodbye and walk out the door, but you’re never going to stop worrying about them, you’re always going to be proud when they do good and annoyed when they don’t.”
“Well, this may be the moment when Lonely Planet waves goodbye to us, but we’re always going to be Lonely Planet’s number one believers and supporters.”
The BBC has concentrated heavily on increasing Lonely Planet’s digital revenues; non-print revenues now account for 22% of total sales.
While the Wheelers will retain some involvement in the business – including continuing to contribute to the company’s publications – they will now step down from the board.
The Wheelers join a long line of entrepreneurs who have headed for the exit in recent month.
In late 2010, recruitment industry pioneer Julia Ross agreed to sell her stake in recruitment business Ross Human Directions, while October saw Helen Logas sell her Travelcorp group to Jamie Pherous’ Corporate Travel Management.
Adir Shiffman also sold his financial products comparison site HelpMeChoose to Mortgage Choice in October, while in the same months Steve Hansen sold his franchise group Chooks Fresh & Tasty to Red Rooster owner Quick Service Restaurant Holdings.
In December, retail veteran Brett Blundy sold two chains – the Dusk candle and homewares chain and the Adairs linen chain – to private equity firm Catalyst for an undisclosed amount.
While surveys have suggested that many entrepreneurs put exit plans on hold while they steered their businesses through the GFC, Karen Crawford, a partner with PWC’s private clients division, says she is now seeing a sharp rise in the business owners considering deals.
“We are seeing a clear pick-up in private transactions at the moment. Certainly there is a little bit more of an optimistic feeling across the economy and buyers coming back into the market.”
While most commentators have been expecting to see a wave of older entrepreneurs selling out as part of their succession planning, Crawford says deals are happening “across the board”.
She points to two main types of deals – opportunistic transactions, where the founder is not necessarily looking to sell but finds themselves fielding takeover offers, and planning exits, where founders are looking at a full or partial sale as part of a long-term exit strategy.
Trade buyers tend to be more prominent than private equity firms, and Crawford says pricing is generally “fair and reasonable”.
“Sellers are not selling at fire sale prices,” Crawford says.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
