Reader's Digest 'saved from administration'

The British arm of Reader's Digest magazine was today expected to be rescued from administration.

Moore Stephens, appointed after the 72-year-old edition of the magazine went into administration earlier this year, was expected to announce that private equity group Better Capital had taken on the business.

Better Capital, set up by private equity veteran Jon Moulton, was among several interested bidders for Reader's Digest UK.

The magazine called in administrators on February 17 when its embattled American parent, Reader's Digest Association, said it was no longer able to support it following a crisis in its pension fund, which had a £125 million deficit.

The British edition has maintained its publishing schedule throughout the administration.

The deal with Better Capital involved tense negotiations to ensure the private equity firm bought the rights to the Reader's Digest brand, which was still owned by its US parent, the Financial Times reported.

Reader's Digest UK employs more than 100 staff and the magazine has a circulation of more than 465,000. But circulation has plunged in recent years - down from more than two million at one stage.

Putting Reader's Digest UK into administration allowed the wider group to plough on with its financial restructuring and RDA has since emerged from Chapter 11 protection.