• by Ray Schultz , August 22, 2024

The Arena Group and Simplify have agreed to terminate their business combination agreement. According to The Arena Group’s Q2 financials, they have agreed to increase the Arena Group’s $25 million line of credit with Simplify to $50 million.  

In addition, $15 million drawn on the line of credit will be turned to common equity.  

Manoj Bhargava, owner of Simplify Inventions, LLC, says: “I want to be clear: I am as committed to The Arena Group today as I have ever been, particularly in light of the shift towards profitability and the success of new leadership in such a short period of time.” 

The Arena Group generated total Q2 revenue of $27.2 million, down from $34.1 million for the same period last year. This reflected a $2.8 million decrease in print revenue and a 10% decrease in digital revenue due to the curtailing of less profitable brands. 

The magazine publisher saw gross profit of $10.7 million, or a 39.3% gross profit margin, versus gross profit of $13.2 million, or 38.7% gross profit margin, in the second quarter of 2023.  

The company seems to have come to terms with its loss of Sports Illustrated management, and has justified its closure of Bridge Media. 

“In the months since our pending business combination with Bridge Media was first agreed to, The Arena Group has ended its management of Sports Illustratedand the Bridge Media assets have not performed to expectations,” says Sara Silverstein, chief executive officer for The Arena Group; “As a result, combining the assets of The Arena Group and Bridge Media no longer made sense. We have terminated the business combination and will move forward as a significantly strengthened stand-alone company with the continued support of our majority shareholder, Simplify.”