BBC Worldwide sells Lonely Planet business at £80m loss
BBC Worldwide, the commercial arm of the BBC, is to sell travel guide business Lonely Planet to US company NC2 Media at a loss of nearly £80m
The BBC Trust has approved the £50m sale, following criticism of the £130m acquisition of Lonely Planet in 2007.
In 2009, a Culture Media and Sport Select Committee said the purchase expanded an area "where the BBC has no, or very limited existing interests".
The Trust has ordered the BBC Executive board to review "lessons learnt".
BBC Worldwide will receive $75m (£51.5m) for Lonely Planet, with an initial $60m (£41.2m) paid on completion and $15m (£10.3m) paid in one year's time.
'Significant financial loss'
The BBC's commercial arm acquired 75% of Lonely Planet in 2007 for £88.1m and the remaining 25% in 2011 for £42.17m, for a total consideration of £130.2m.
The Lonely Planet suffered from the prolonged global recession and the Australian dollar appreciating to 58% against the UK pound - 80% of Lonely Planet's revenues are generated from foreign currency.
The sale follows the corporation's commercial review last year which set out the company's strategy to focus on BBC brands and promote the best of its output globally.
Diane Coyle, Trust vice chairman and chair of the Strategic Approvals Committee, said: "The Trust's strategy for Worldwide now is to focus on BBC programme content, and Worldwide would not make this sort of acquisition again.
"Although this did not prove to be a good commercial investment, Worldwide is a very successful business; and at the time of purchase there was a credible rationale for this deal.
"Given the significant financial loss to Worldwide, however, we have asked the BBC Executive to commission a review of lessons learnt and report to the Trust with its findings," she added.
Paul Dempsey, interim chief executive officer of BBC Worldwide, said: "We acquired Lonely Planet in 2007 when both our strategy and the market conditions were quite different.
"Since then, Lonely Planet has increased its presence in digital, magazine publishing and emerging markets whilst also growing its global market share, despite difficult economic conditions.
"However, we have also recognised that it no longer fits with our plans to put BBC brands at the heart of our business and have decided to sell the company to NC2 Media who are better placed to build and invest in the business."
Three years ago, a BBC Trust report said the "scale and nature of the Lonely Planet acquisition" would not be considered again but at the time, it said that Lonely Planet would not be sold off.