The internet has not been kind to Condé Nast, the publisher of starry magazines like Vogue and Vanity Fair, whose fortunes and influence have waned in the digital age. However, a surprising turn of events is set to bring a windfall of roughly $1.4 billion to the Newhouse family, the media dynasty that controls Condé Nast through its holding company, Advance Publications.
The source of this windfall? Reddit, the social site that Condé Nast acquired for a mere $10 million in 2006. With Reddit now set to be listed on the New York Stock Exchange, the Newhouse family, who own roughly one-third of the outstanding shares, are poised to benefit significantly from their early and prescient bet on the company.
While Condé Nast itself has faced challenges, including recent layoffs and revenue stagnation, Advance Publications, the parent company, has major stakes in other investments such as Charter Communications and Warner Bros. Discovery. The financial details of how Condé Nast may benefit from the Reddit stock remain uncertain, as representatives declined to comment.
The Newhouse family’s success with Reddit is in line with their business strategy, set by patriarch Samuel I. Newhouse, who founded Advance in 1922. Newhouse was known for his ability to turn struggling assets into profitable ventures, a skill that has clearly been passed down through the generations.
Robert A. Sauerberg Jr., a former Condé Nast chief executive who remains on the board of Reddit, also stands to benefit from the Reddit listing, owning nearly 50,000 shares in the tech company. His stake could potentially be worth $1.6 million under the price target of $34 a share.
Overall, the impending windfall from Reddit serves as a bright spot for the Newhouse family and Advance Publications, showcasing their ability to adapt and thrive in the ever-changing digital landscape.
