Murdoch to Sell 9 Publications to KKR-Led Group

News Corp., the media conglomerate controlled by Rupert Murdoch, has agreed to sell nine of its U.S. publications to a group headed by a leading takeover firm for more than $600 million, a source close to Murdoch said.

Included in the transaction are the Racing Form, which is a daily newspaper, and eight magazines: Seventeen, Premiere, New York, European Travel and Life, New Woman, Automobile, Soap Opera Digest and Soap Opera Weekly.

Kohlberg Kravis Roberts & Co., an investment firm that specializes in leveraged buyouts, put together the partnership, known as K-III Holdings, that is buying the publications.

It is KKR’s second high-profile deal this week. On Monday, the firm teamed up with Rhode Island’s Fleet/Norstar Financial Group as the surprise winner of the Federal Deposit Insurance Corp.’s sale of failed Bank of New England.

Thursday’s sale does not include Murdoch’s best-known magazine, TV Guide, or its new entry in the women’s field, Mirabella.

Murdoch, the Australian-born entrepreneur, has been under pressure from his bankers to slash News Corp.’s debt, which skyrocketed during the 1980s as he went on a global buying spree. His other properties include 20th Century Fox and television stations and newspapers on several continents, including the prestigious Times of London. One persistent cash drain for Murdoch has been his investment in British Sky Broadcasting, a satellite TV company in England.

The venerable and highly profitable Racing Form is horse racing’s leading publication. It was purchased from Walter Annenberg, along with Seventeen and TV Guide, in a $3-billion deal. Murdoch has since acknowledged that he overpaid.

The fact that Murdoch sold the publications at a time when the market for media properties is depressed is an indication of his financial straits. He resolved to sell them as a package because some are unprofitable and might have been impossible to sell individually.

The decision disappointed many media companies that were interested in one or another of Murdoch’s titles to round out their magazine offerings. Hearst Corp. was said to covet Premiere; Conde Nast was eyeing Seventeen. New York magazine’s management had wanted to put together an offer to buy it from Murdoch.

Kohlberg Kravis has said it will continue to hold all of the magazines, though many in the publishing industry believe that the partnership will likely entertain offers for individual titles. It isn’t clear whether there will be changes in the magazines’ management.

K-III’s bid outstripped a reported offer by Cahners Publishing, a New York-based unit of Britain’s Reed International that publishes Variety and a number of trade journals.