5-Hour Energy Founder to Buy Majority Stake in Sports Illustrated Publisher

Manoj Bhargava, a businessman who founded the caffeine beverage brand 5-Hour Energy and owns TV news stations, has agreed to acquire a majority stake in the publisher of Sports Illustrated. 

One of Bhargava’s companies, Simplify Inventions, will take an approximately 65% stake in the Arena Group, which beyond Sports Illustrated is home to media brands including Men’s Journal. As part of the deal, Arena will get a $50 million investment. The deal also includes a five-year guaranteed advertising commitment of approximately $60 million from a group of consumer brands also owned by Simplify. 

Arena will assume oversight of various media properties owned by Bhargava, including 24-hour news TV channels NEWSnet and Sports News Highlights, as well as media brands Driven and TravelHost. Arena will oversee programming and advertising for the channels, and generate revenue from those functions, it said.   

“Like most in the media world, the greater reach you have, the more opportunity you have,” said Arena chief executive Ross Levinsohn. “This dramatically accelerates our path to being a diversified media company featuring great brands.” 

A final deal is subject to various approvals and the completion of due diligence, the companies said.   

The agreement comes as publishers face an uncertain economy and advertisers continue to pull back or rethink their spending. Arena recently had been in talks with Group Black about a potential tie-up, but no deal materialized.   

Bhargava quickly gained notoriety and fortune from the success of his 5-Hour Energy product, which launched in 2004. More recently, he has invested in media assets. 

Another one of his companies, IV Media, is acquiring iMedia Brands, which owns TV shopping network ShopHQ, for around $55 million out of bankruptcy, according to a recent filing. 

Last year, he acquired NEWSnet. He has also built a network of local TV stations, including 50 owned stations and a number of affiliates. He also backed Bleecker Street, a film-distribution company.   

Bhargava said the combination of broadcast and digital assets and brands would be greater than the sum of its parts. “And we’re just getting started,” he said.

—Alex Saeedy contributed to this article.

Write to Alexandra Bruell at [email protected]