A firm backed by the Chinese government is poised to purchase Forbes Magazine for as much as $650 million.
The proposed merger between Forbes Global Media Holdings (Forbes) and Magnus Opus Acquisition Limited (Magnus Opus) was first announced in August of last year, and is expected to finalize within the next month. SEC filings show that Magnus Opus received its seed capital from the state owned Chinese Investment Corporation. Other state-owned media operating in the United States, such as Xinhau News Agency and China Daily, are required to disclose their ties to the Chinese Communist Party (CCP), but the pre-existing Forbes brand could obfuscate the connection and smuggle CCP talking points into the American mainstream.
“Forbes is a recognizable American brand with immense propaganda value to the CCP,” Senators Tom Cotton (R-AR), Bill Cassidy (R-LA), Bill Haggerty (R-TN) and Ted Cruz (R-TX) wrote in an open letter to Treasury Secretary Janet Yellen, calling for more oversight of the CCP’s purchasing of U.S. assets. “The CCP’s direction of Forbes’ editorial content and business operations, or its access to Forbes’ financial and personal research, could present a serious national security threat to the United States.”
Forbes was founded in 1917 by B.C. Forbes, and during the 1920s it operated as the only business magazine in the United States. The publication is famous for its annual list of the wealthiest Americans, the Forbes 400, and it was valued at $475 million in 2014, when 95% of the company was purchased by a Hong Kong based investment group, Integrated Whale Media Investments. The Forbes family presently holds the remaining 5%.
“China’s deliberately vague patchwork of intelligence, national security and cybersecurity laws compel companies to support and cooperate with the government’s intelligence work,” the senators argued when outlining their concerns, with Magnus itself noting in its SEC filings that Forbes “could be subject to oversight and discretion of PRC [People’s Republic of China] government authorities, which could seek to intervene and influence its business operations at any time that the government deems it appropriate to further their regulatory, political and societal goals.”