The Advocate joins PlanetOut family

PlanetOut Inc. on Wednesday purchased the assets of LPI Media Inc.--including the magazines The Advocate and Out and related Web sites--for $31.1 million. The move creates the world's largest media company serving gay men and lesbians. It also nearly doubles PlanetOut's estimated 2005 pro forma revenue, according to a company press release.

The San Francisco-based public company paid $24 million in cash and $7.1 million in seller-financed debt for the assets of Los Angeles-based LPI Media. PlanetOut said it will also reimburse certain prepaid and other expenses totaling about $1 million.

"This transaction will further advance our strategy of building a far-reaching media and entertainment company which aggregates the largest gay and lesbian media brands," said Lowell Selvin, chairman and chief executive officer, PlanetOut Inc. "This combination provides a larger, more diverse foundation for additional growth, particularly in our advertising business, as it becomes a larger percentage of our overall revenue, and it enables us to better reach the markets we serve, driving higher growth in a more cost- effective manner. Besides, this is one gay marriage the laws do allow!"

Out and The Advocate are the two largest-circulation LGBT magazines in the United States. LPI distributes more than 8.2 million copies of its magazines each year.

PlanetOut stock, traded as the symbol LGBT, closed up 5.6% on Wednesday, at $7.51 per share. (Advocate.com)