Stake in Publishing Giant Sold

San Francisco-based private equity firm Hellman & Friedman said Thursday that it had agreed to buy a 19.4% stake in German publishing giant Axel Springer from Deutsche Bank for $413 million, adding to its media holdings.

With about $3.3 billion in annual revenue, Axel Springer is Germany’s largest publisher of newspapers and second-largest publisher of magazines. Its titles include the national tabloid Bild, Europe’s bestselling paper, with a daily circulation of 4 million.

Brian M. Powers, 54, newly named chief executive of Hellman & Friedman, would join Axel Springer’s board after the deal’s closing, which was expected within a week.

“It’s a good company, a good value and a good play on the cyclical recovery in Europe,” Powers said, adding that Axel Springer has remained “solidly profitable” in recent years despite a sharp slide in advertising.

Hellman & Friedman, founded in 1984 by former Lehman Bros. Holdings President F. Warren Hellman, has invested more than half of the $2.2 billion it raised for its fourth private equity fund. Other current stakes include Nasdaq Stock Market Inc., insurer Arch Capital Group Ltd. and German TV network ProSiebenSat.1.

As in the Axel Springer deal, the firm often takes minority stakes, Powers said, and it avoids leveraged buyouts.

Powers said the industry appealed to Hellman & Friedman. “We’ve traditionally liked businesses with strong franchises and strong cash flow,” he said.