Martha Stewart Living Omnimedia nears deal to sell company to SQBG
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Martha Stewart Living Omnimedia

Martha Stewart Living Omnimedia nears deal to sell company to SQBG

After building a large empire on satin bows, fondant layers cakes, and fluffy-chive blossom arrangement, Martha Stewart is in search for a new home. According to people familiar with the matter, Martha Stewart Living Omnimedia Inc. is close to a deal to selling itself to Sequential Brands Group, an acquisitive retail-licensing company.

Martha Stewart Living’s executives have been dumping investments losses in business in recent years, including its streamlined operations to, magazine publishing unit to reduce losses and attract more investors and prospective buyers in the business. It cut real estate holdings by 20 per cent, and curtailing staff executives to 270.

Ms. Stewart, the Chairman of MSLO, acting as the company’s board as non-executive chairman, Martha Stewart Living has switched the spot light to its strength – selling home products designed to appeal to Martha Stewart’s fans – and finding customers in the international markets.

The deal would be an opportunity to broaden its portfolio for Sequential Brands Group (SQBG) that owns consumer brands in fashion and lifestyle categories, including And 1 and Linens N Things. In April, SQBG bought a major stake in the Jessica Simpson brand that sells products inspired and partly designed by the pop star.

In the first quarter, Martha Stewart Living posted $17.1 million in revenue earnings - down from $33.3 million last year. The reduction was partly due to the shedding of some business lines, including the digital and print media operations.

A deal would usher in the latest chapter of the remarkable career of the company to be sold; investors have been scooping up its shares. Currently, the company’s stock has risen up to 49 per cent; on Thursday, the stock of MSO rose to 27 per cent to end at $6.46. On Thursday, the shares of Sequential Brands have risen up to 13 per cent with a stake worth of $16.08.

Both the companies are still negotiating with terms, and a deal will soon be announced in the coming days.

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