Sky News has learnt that Exponent Private Equity has entered exclusive talks to buy Dennis Publishing, the company set up by the colourful late media tycoon Felix Dennis.
A formal deal remains some weeks away, but insiders said on Thursday that Exponent would pay between £150m and £200m for Dennis, which also owns a cluster of motoring and computing magazines.
If completed, the takeover would mark a return to the British media arena for Exponent, which also previously owned the Racing Post.
In 2011, the buyout firm acquired the BBC’s magazines portfolio, which included the Radio Times, food title Olive and Gardens Illustrated.
Exponent sold the business just over five years later to Hubert Burda, the German media group.
It emerged last week that Daily Mail & General Trust (DMGT) had lodged a formal offer for The Week, the current affairs magazine which summarises reports from national newspapers on the major stories of the previous seven days.
DMGT, which is close to landing a £640m windfall from the takeover of Zoopla-owner ZPG, also offered to acquire Moneyweek and The Week’s US sister title as part of a deal.
However, the Dennis trustees are understood to have favoured Exponent’s offer because it would involve selling the entire company.
One source said DMGT was exploring possible options to work its way back into the auction.
Dennis was put up for sale by the executors of its founder’s estate, with the proceeds expected to be distributed to The Heart of England Forest Charity, which was also set up by the tree-loving Mr Dennis.
The charity’s trustees are chaired by Jon Snow, the Channel 4 News presenter.
Both Dennis and publishing rivals such as Time Inc UK have provided evidence of the toll being exerted on print media groups in recent years amid growing pressure on advertising revenues as readers increasingly shift online.
In 2009, Dennis ceased publication of Maxim UK’s print edition following a catastrophic decline in sales in the lads’ mags category.
However, The Week, which on a standalone basis is said to to be valued at more than £100m, has seen its circulation rise steadily even as the newspaper titles it summarises have seen demand shrink at a rapid rate.
Figures produced by PricewaterhouseCoopers suggest that print advertising revenue for consumer magazines will fall to $6.7bn in the US by 2021, less than half the $13.6bn that magazines took in 2012.
Print circulation sales are projected to drop 23% to $6.1bn over the same period, and industry trends are broadly similar in the UK.
The Dennis auction is being handled by Livingstone Corporate Finance, an advisory firm.
Exponent, DMGT and Livingstone all declined to comment.