Rothschild Stake in The Economist Group Up for Sale as Ownership Set for Major Shift

The process to find a buyer for Lady Lynn Forester de Rothschild’s significant minority stake in The Economist Group has commenced, signalling the first substantial change in the publication’s ownership in a decade. The 27 per cent holding, currently being marketed by investment bank Lazard, is expected to command a price nearing £400 million, with completion anticipated by the end of the year.

Initial discussions have begun with several high net worth individuals and family offices, predominantly based in Europe and the United States, regarding the 182-year-old media group’s shares. The stake, currently representing 20 per cent of the voting rights at The Economist, has attracted considerable interest given the publication’s influence and prestigious global readership of 1.25 million.

Lady de Rothschild, aged 71, is believed to have reached out to banking advisers months prior to the formal launch of the sale. Her business credentials include the founding of FirstMark Communications and a seat on the board of Estée Lauder. Following her marriage to the late Sir Evelyn de Rothschild in 2000, the couple established EL Rothschild, a family office with diverse interests, and the Eranda Rothschild Foundation.

The Economist Group features a complex share structure, comprising ordinary shares, A and B shares, as well as trust shares. Notably, the trust shares are overseen by trustees who safeguard editorial independence and must sanction transfers of the specialist A and B shares. The Rothschilds’ holding consists largely of A and ordinary shares, which come with significant powers such as nominating one of three seats on the nominations committee, instrumental in overseeing board appointments.

Under current rules, no shareholder may control more than 50 per cent of The Economist Group’s economic interest nor exceed 20 per cent of the voting rights. The Agnelli family, via their Exor investment vehicle, presently holds a 43.4 per cent stake since acquiring it from Pearson in 2015. Documentation detailing the sale highlights that as the sole shareholder with more than 15 per cent of both A and ordinary shares, the Rothschild family alone may nominate two non-executive directors to The Economist Group board.

The company posted a revenue of £369 million for the last financial year, a 3 per cent rise, with an operating profit of £48.1 million. Over the most recent twelve months, dividends paid out totalled £43 million, up sharply from £32 million attributed in part to the sale of its medical data unit, Clearstate. EL Rothschild and the Eranda Foundation are continuing their assessment of strategic portfolio options as discussions with potential buyers progress.