Sports Illustrated to lay off significant number of employees - union (updated)

Paradium.AI

19/01/2024 19:26

(Recasts throughout to add details on potential layoffs, union
comment, background on Arena Group)
       Jan 19 (Reuters) - Sports Illustrated is planning to lay
off a significant number of workers after its publisher failed
to make a quarterly payment, ending the licensing deal for the
storied publication, the union for the magazine's workers said
on Friday.
        The publisher, Arena Group, said in a filing earlier
this month it failed to make the $3.75 million payment to
Authentic Brands Group - the owner of Sports Illustrated and
from whom it licenses the magazine.
  
        That led Authentic Brands Group to end the agreement
which the companies had signed in June 2019. Under that deal,
Arena Group had the exclusive right and license to operate
Sports Illustrated including its digital and print editions in
countries including the United States, Canada and Mexico.
  
    Possibly all Sports Illustrated's Guild-represented workers
could be laid off as a result of the revoked license, the union
said in a post on X social media.
    "We are calling on ABG (Authentic Brands Group) to ensure
the continued publication of SI and allow it to serve our
audience in the way it has for nearly 70 years," it said.
    Arena Group did not immediately respond to a request for
comment on the layoffs. It also owns finance media outlet the
Street, among others.
        In a filing on Thursday, Arena Group said it planned to
keep a check on operating expenses by cutting its workforce by a
third as a result of tough economic conditions and termination
of the licensing deal.
    The potential layoffs would be the latest in the media
industry. The news also comes just a day after the Los Angeles
Times' union said the newspaper plans to lay off a "significant"
number of journalists.
    At the end of 2021, Arena Group had about 400 employees,
according to a regulatory filing made with the U.S. Securities
and Exchange Commission in March 2023. 
    Arena expects to incur about $5 million to $7 million in
restructuring charges and recognize a substantial portion of the
charges in the first two quarters of 2024.   

 (Reporting by Samrhitha Arunasalam and Akash Sriram in
Bengaluru; Editing by Maju Samuel)
 ((Samrhitha.A@thomsonreuters.com))