Maxim magazine, the bawdy men’s title that went up for sale in March, is seeing some bids of about $20 million, less than a 10th of the price its owners paid six years ago, according to people familiar with the situation.

Maxim publisher Alpha Media Group Inc., controlled by creditor Cerberus Capital Management LP, is expected to lose between $3 million and $5 million this year, according to the people, who asked not to be named because the matter is confidential.

The magazine’s owners are seeing yearly revenue declines as Maxim, once a leading men’s title, contends with an industry wide slump in marketing dollars. Advertisers and readers have shifted their attentions toward digital venues, where ad rates are cheaper and the content largely free.

Maxim’s annual ad sales dropped 18 percent to $112 million last year, compared with a 2.9 percent slide among magazines as a whole, according to the Publisher’s Information Bureau. In the first three months of this year, Maxim saw a 45 percent decline from a year earlier to $13.1 million.

The owners have continued to cut costs and are trying to contain losses within the range of a few million dollars, according to the people familiar with the company’s finances. A number of companies made qualifying initial bids, with second- round offers due July 15, these people said.

 

‘Highly Engaged’

 

Competition from the Internet has hurt magazine advertising, and Maxim hasn’t fully capitalized on the growing digital audience.

“Maxim does not comment on rumor or speculation, but we can confirm that Maxim is in discussions with a strong group of highly engaged, potential buyers,” Publisher Benjamin Madden said in an e-mailed statement.

Felix Dennis, the British publishing impresario, founded Maxim in 1995 and introduced it to U.S. audiences a few years later, luring in readers with the tagline “Sex Sports Beer Gadgets Clothes Fitness.” Its immediate success kicked off a wave of similarly themed titles and prompted U.S. men’s magazines to adjust their editorial voices to follow suit.

Dennis sold Maxim, along with sister titles Blender and Stuff, for $250 million in a leveraged buyout by an investment group led by Quadrangle Capital Partners LP in 2007, just before the recession gutted the magazine industry’s profits as it faced a steep drop in the ad market. The owners have since closed down Stuff and Blender.

 

Stopped Payments

 

In 2009, Quadrangle stopped payments on about $160 million of loans used to buy the magazine company, leaving creditors, led by Cerberus, as its new owners, according to one of the people. Peter Duda, a spokesman with firm Weber Shandwick that represents Cerberus, declined to comment.

Maxim published 11 times last year and has an average circulation of 2.5 million, according to the Alliance for Audited Media. While it’s still one of the largest men’s magazines by circulation, it saw a 22 percent drop in ad pages to 392 last year, compared with a year earlier, according to Publisher’s Information Bureau. Conde Nast’s GQ, another men’s title, saw a 3.5 percent drop in ad pages to 1,183, according to the bureau.

The U.S. magazine industry has increasingly struggled to find buyers for once-vaunted publications. Billionaire Barry Diller said earlier this year that he regretted buying Newsweek in 2010 and is now exploring a sale of the publication. Time Warner Inc., meanwhile, is spinning off its magazine division after a failed deal with Meredith Corp.

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