Ascend Media has sold the assets of its healthcare division on College

Road to Michael Hennessy & Associates Inc., a medical publishing firm

based at Princeton Meadows Office Center.

Some might view the unbundling of the healthcare division, which

failed to meet the goals of its Kansas-based investors, as a case of

greedy investors getting their comeuppance. "Be of value to your

audience first, and the profits come second," they would say. "When

private equity is involved, the CEO gets squeezed for performance

beyond what may be good for the company."

Others might point to how the market has gone soft for primary care

publications, which have seen their advertising levels fall.

But perhaps most interesting to Princeton observers is that Mike

Hennessy, a second-generation medical publisher, has brought into his

fold some distinguished titles with a family connection. He and his

brother, Jack Hennessy, each had their own medical publishing

businesses. The magazines Mike bought were previously owned by Jack,

who had sold them to Ascend.

John J. "Jack" Hennessy founded Medical World Communications in 1985.

Among the well-respected magazines he published were Pharmacy Times

(founded at the turn of the century) and American Journal of Managed

Care (one of the few free-circulation magazines included in important

indexes).

Jack Hennessy got into some legal problems regarding circulation

statistics, and in 1993 he took on a majority shareholder, Great Hill

Partners, using those funds to rapidly acquire other firms. In 2001 he

reported revenues of $100 million. He sold his company to Ascend Media

three years ago (U.S. 1, April 26, 2005).

Ascend Media was founded by former executives of publishing giant

Primedia. Their new business-to-business media company was their first

foray into the health industry. After acquiring Medical World in 2005.

Ascend Media had $150 million in revenue, and it published 50

magazines and journals in the medical and healthcare field.

"We were successful enough that we could be sold," says Will Passano,

the former president of Ascend’s health division. "Intellisphere had a

lucky opportunity to buy two strong assets, Pharmacy Times and

American Journal of Managed Care." Passano, the scion of a medical

publishing family in Baltimore, had expanded by moving Ascend’s 100

employees from Forsgate Drive to 18,800 square feet at 103 College

Road East (U.S. 1, June 28, 2006).

Now some of the magazines have suspended publication, five dental

magazines have been spun off, and just 27 employees remain. "We have

tried to find homes for as many people as possible," says Herb Marek,

president of the new division of Michael Hennessy’s company. Soon they

will move to Hennessy’s headquarters on Plainsboro Road, where they

will occupy all of Building 300 and a series of suites in Building

400. "The College Road space has room for well over 80 people, and

this layout is too `closed’ for our liking – it does not fit in with

our culture. We like a much more open space where people can interact

and work with each other."

Until Hennessy bought the Ascend magazines, the biggest company under

his umbrella was Intellisphere LLC, publisher of the MD Net Guide

series of journals, E-mail newsletters, and digital publications

(www.mdng.com). In 1999, when most doctors had only dial-up

connections to the Internet, he launched MD Net Guide to help doctors

find the websites, tools, and other resources that might help them

streamline their practice and offer better patient care. MD Net Guide

did the legwork for them, highlighting the best online professional

resources. Now Intellisphere has seven specialty-specific editions of

MD Net Guide for 200,000 physicians and specialists.

Hennessy also owns Arc Mesa, a medical education company in Monroe,

and Hospital Research Associates (HRA), a market research firm in

Parsippany.

Ever since Ascend Media went on a buying spree, some industry

observers had been predicting that Ascend would end up selling some

the purchases to pay debt. Before the sales, the medical/dental

division had revenues of $60 million, according to trade publication

FOLIO. Ascend is keeping four of its healthcare divisions, says

Kansas-based CEO Vicki Masseria, who stepped up to that job in

December.

Ascend’s newest dental magazine, Dental Product Shopper, had been spun

off to its creator, David Branch (www.dentalproductshopper.com). This

company is in transition, has no listed address or phone, and Branch

was not available by press time.

The remainder of the dental assets from Ascend Media went to Dan

Perkins, a long-time dental publisher who had been president of

Medical World Communications. When MWC was sold to Ascend, he and his

cohorts left to found a dental publications company, Aegis

Communications, in Newton, Pennsylvania. His flagship publication,

Inside Dentistry, gets a 12 percent market share of ad dollars, and

sells a full page ad for $8,300.

"It was a situation where we had the ability to do it," Perkins says.

For 18 years Perkins had run the Compendium, and he and his team

launched the other titles that he bought. "We ran them, we launched

them, so our team has intimate knowledge of those publications," says

Perkins. "We have a solid plan to bring them back to where they

belong." He hired one Ascend employee from Ascend.

Perkins has plans for Contemporary Aesthetics and Contemporary Dental

Assisting, and he believes the new titles will double his firm’s net

worth. He also acquired Advanced Aesthetics & Interdisciplinary

Dentistry, Functional Esthetics & Restorative Dentistry, the Middle

East Journal of Oral Health, and Dentistry India.

Perkins says he has been offered private equity investment deals, such

as the one that Jack Hennessy took. He has nothing but praise for the

company from which he bought the magazines. But, looking at what has

happened to companies that took investment, is convinced that he

doesn’t want to go that route. "We are publishers, not bankers. We

love our marketplace. They don’t care about the marketplace. We are

proud to call ourselves dental geeks."

Facebook Comments