US media company Meredith has announced it will buy Time in an all-cash deal backed by the Koch brothers, giving the ultra-conservative billionaires a stake in one of America's best-known publishers.
Image: Hoang Dinh Nam/AFP/Getty Images
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The publisher of the eponymous Time Magazine as well as Fortune and Sports Illustrated is selling to Meredith Corporation for $2.8 billion, with Meredith offering $18.50 a share in cash — a premium of 46 percent to the US publisher's price in November.
The deal had been approved by both companies' boards and was expected to close in the first quarter of 2018, Meredith said on Sunday. Iowa-based Meredith is backed by the Koch brothers, who are known for supporting conservative causes.
The transaction marks the end of an era for 94-year-old Time. It has been trying to transform itself from a print to a digital media business after several years of declining revenues. But the restructuring has been hampered by Time's long-term debt burden of $1.2 billion. The Meredith deal now includes the assumption of that debt.
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The Economist - The rich revolutionary
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The combined brands will have a readership of 135 million people and paid circulation of nearly 60 million. The deal will also expand Meredith's reach with internet-savvy millennials, creating a digital media business with 170 million monthly unique visitors in the United States and more than 10 billion annual video views.
Conservative media influence
Time began looking for a buyer late last year before giving up several months later, while welcoming options. Meredith had expressed an interest earlier this year, but then walked away because it could not secure the necessary financing.
Among the funds financing the purchase are $650 million from Koch Equity Development, a fund belonging to Charles and David Koch.
"We are creating a premier media company serving nearly 200 million American consumers across industry-leading digital, television, print, video, mobile and social platforms positioned for growth," said Meredith chairman and CEO Stephen Lacy.
The Koch brothers are two of the world's richest men through their ownership of Koch Industries, a sprawling industrial empire. They are also known for their advocacy of conservative policies and influence on some quarters of the Republican Party.
But the companies said the Koch unit would not have a seat on Meredith's board and would have no influence on Meredith's editorial or managerial operations.
