BY Richard Summerfield
After a number of failed attempts to complete a deal for the company, American media conglomerate Meredith Corporation has announced that it is to acquire Time Inc. in an all cash deal worth $2.8bn, including the assumption of debt and net of cash acquired.
Under the terms of the deal, Meredith will pay around $18.50 per Time share to acquire the company. The $18.50 per share price represents a 46 percent premium over Meredith’s closing price on 15 November 2017, the day prior to media reports about the transaction, and a 66 percent premium over the company’s 10-day volume weighted average trading price ending on that day.
Meredith had made a number of attempts to acquire Time Inc over the last four years but was unable to complete the deal, until now. Pending the customary closing conditions and regulatory approval, the transaction is expected to complete during the first quarter of 2018.
"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 chief executive Stephen M. Lacy. "We are adding the rich content-creation capabilities of some of the media industry’s strongest national brands to a powerful local television business that is generating record earnings, offering advertisers and marketers unparalleled reach to American adults. We are also creating a powerful digital media business with 170 million monthly unique visitors in the US and over 10 billion annual video views, enhancing Meredith’s leadership position in reaching millennials."
John Fahey, chairman of Time, said, "Time Inc.’s board of directors has unanimously determined that this all-cash transaction, and the immediate, certain value it provides, is in the best interests of the company and its shareholders. On behalf of the entire board, I thank Rich Battista for his strong and exemplary leadership. We also thank the management team and all Time Inc. employees, who together have made significant progress transforming one of the world’s most iconic and historically significant publishing companies into a leading multiplatform media enterprise."
The deal will be partly financed by a $650m investment by Koch Equity Development. Meredith will also be using $3.55bn in financing commitments obtained from a variety of lenders, the company said in a statement.