Byron Preiss Multimedia Corp. has signed a letter of intent to sell substantially all the assets of five of its subsidiaries to Frontline Communications, an Internet service provider based in Pearl River, N.Y. Included in the sale are Dolphin Inc., Multi Dimensional Communications, New Media Schoolhouse, Internet Education Group and Byron Preiss Publishing Inc. The value of the deal, which includes more than 200 educational software titles plus other content-based assets, is placed at $6-7 million in cash and stock. "I think it's a good deal for all shareholders," Byron Preiss told PW; BPMC's shareholders include Simon &Schuster, which holds a more than 10% stake in the company.
Most of the properties being sold were acquired by BPMC in recent years as the company tried to make the transition from a CD-ROM publisher to a more broad-based multiple media company that produced computer software, Internet content and books. The company has never reached profitability, however, posting sales of $4 million and a net loss of $1.1 million for the first six months of 1998. Preiss speculated that most of the staff in the operating divisions will move to Frontline, although BPMC has eliminated some positions at its New York offices.
Stephen Cole-Hatchard, president of Frontline, said that after the deal is closed, the company will offer its product through its Web site. "Rolling these entities into Frontline is a major step in implementing the e-commerce side of our business plan and adds tremendous value to our company," Cole-Hatchard explained.
The deal with Frontline will have no impact on Preiss's privately held book packaging company, which has been in operation for more than 20 years. The company recently released one of the biggest books in its history, The American Heritage History of the U.S.
