Canadian Billionaire Stephen Smith Buys Stake in The Economist Group

The ownership structure of The Economist has shifted again, with Canadian billionaire Stephen Smith acquiring a 26.9% stake in the parent company, The Economist Group (TEG), from Lynn Forester de Rothschild. This marks only the third significant change in ownership in the publication’s 183-year history, signaling a notable moment for the influential news magazine.

Smith, whose family holding company Smith Financial Corp owns financial businesses including a co-ownership of the proxy advisory group Glass Lewis, purchased the stake for an undisclosed sum. Last year, the Rothschild family’s holding in TEG, which includes 20% of the voting shares, was estimated to be worth approximately $537 million (£402 million). The deal is subject to approval from TEG’s independent trustees and board of directors, who are tasked with safeguarding the publication’s editorial independence.

Financial Performance and Subscriber Growth

The Economist Group reported solid financial results for the year ending March 2025, with revenues reaching £369 million and a profit of £48 million. Subscriber numbers to The Economist magazine itself increased by 3% to 1.25 million, demonstrating continued demand for its in-depth analysis and global coverage. This growth likely contributed to the attractiveness of the stake for potential investors like Smith.

Smith’s Broader Business Interests

Stephen Smith is a prominent figure in the Canadian financial landscape. Beyond Smith Financial Corp, he chairs Historica Canada, the publisher of the Canadian Encyclopedia, and serves as an honorary governor of the Royal Ontario Museum. His net worth is estimated at $7 billion, according to Forbes. Forbes details his extensive holdings and philanthropic commitments to education, history, and the arts. His involvement with Glass Lewis, a key proxy advisory firm, adds another layer to his business portfolio, potentially influencing corporate governance discussions globally.

The Rothschilds’ Long-Held Stake

Lynn Forester de Rothschild, her family, and her family foundation have been shareholders in TEG since 2002. Forester de Rothschild is the chief executive of EL Rothschild, a private family office, and the founder of the Council for Inclusive Capitalism, a non-profit organization focused on promoting equitable economic growth. The decision to sell her stake follows a year-long exploration of options, with investment bank Lazard advising on the potential sale.

Existing Shareholder Landscape

Exor, the investment company controlled by the Agnelli family (heirs to the Fiat fortune), remains the largest single shareholder in The Economist Group, holding a 43.4% stake. TEG itself owns approximately 30% of the company, while other shareholders include members of the Cadbury and Schroder families. TEG’s ownership rules prevent any single shareholder from controlling more than 20% of the voting rights, a structure designed to protect the publication’s editorial independence.

A History of Ownership Shifts

This transaction follows a significant ownership change in 2015, when Exor increased its holding from 4.7% to 43.4% by acquiring most of Pearson’s 50% stake for £287 million. Pearson had initially acquired its stake alongside the Financial Times in 1957, but subsequently sold the Financial Times to Nikkei in 2015 for £844 million. The Guardian reported extensively on the Nikkei acquisition at the time.

Implications for Editorial Independence

A key concern surrounding any change in ownership at a publication like The Economist is the potential impact on its editorial independence. Still, a spokesperson for TEG emphasized that Smith’s investment “reflects…full support for the Economist’s long‑standing tradition of rigorous editorial independence” and that the publication’s strategy and operations will remain unaffected. This assurance is crucial, given The Economist’s reputation for unbiased reporting and analysis.

What’s Next: Regulatory and Shareholder Approvals

The completion of the deal hinges on securing approvals from both TEG’s independent trustees and its board of directors. The trustees play a vital role in upholding the publication’s editorial values, and their endorsement is essential. Following these approvals, the transaction can be finalized, and Smith will officially become a significant shareholder in The Economist Group. The timeline for these approvals remains undisclosed, but is expected to occur in the coming weeks.

The acquisition by Stephen Smith adds another chapter to the evolving story of The Economist, a publication that has consistently adapted to the changing media landscape while maintaining its commitment to insightful journalism. The focus now shifts to ensuring a smooth transition and preserving the publication’s independence as it navigates the challenges and opportunities of the future.

For further information on Smith Financial Corporation, visit their website: Smith Financial Corporation.