NEW YORK ― Martha Stewart Living Omnimedia has hired Blackstone Advisory Partners, signaling it could strike a partnership or sell a stake in the company and sending shares up more than 30 percent.
At the same time, the company’s founder, Martha Stewart, announced Wednesday that she expected to rejoin the board of directors in the third quarter.
The company, known for its flagship magazine and brands, said it hired Blackstone after having been approached by other parties interested in becoming a partner or investing in it.
But it cautioned, “there is no assurance that the exploration of strategic partnerships and other opportunities will result in a partnership or transaction.”
A source familiar with the situation said there has not been an offer made for the entire company. The source added that while founder and controlling stockholder Stewart would prefer a transaction other than an outright sale, she will consider all options.
The company’s shares were up 31.3 percent at $4.95 in late morning trading on the New York Stock Exchange.
Once a company whose stock traded around $30 a share, Martha Stewart Living has struggled to draw advertising dollars, turned over top management and laid off staff over the last several years. The company currently has a stock market value of just over $200 million.
Stewart’s legal troubles ― she served a prison sentence after being convicted in 2004 of lying to investigators about a stock sale ― have also created headaches for the company. Stewart founded the company in 1997, but a settlement with securities regulators barred her from serving as a director or top executive until August 2011.
While Stewart is planning to return as a board member, the company also announced that Lisa Gersh, a co-founder of Oxygen Media, would be joining the company to run day-to-day business as chief operating officer. She is expected to assume the role of chief executive within 12 to 20 months, the company said, filling a vacancy.
Gersh will be charged with overseeing the company’s three main divisions: publishing, television and merchandising, where it has deals with Home Depot, Macy’s and Kmart, among others. Annual sales from all three divisions have steadily declined since 2008.