‘Time Magazine’, ‘Fortune’ put up for sale by new owner Meredith
New York: Meredith Corp., which bought Time Inc. and its stable of magazines in January, plans to sell the flagship publication Time Magazine, Sports Illustrated, Fortune and the Money brand after completing a review of the $1.8 billion deal.
The company also plans to eliminate about 1,000 jobs over the next 10 months as it integrates other Time Magazine publications into a lineup that includes Better Homes & Gardens and Family Circle, according to a statement Wednesday. The cuts are on top of firing notices given to 200 employees, the company said.
Meredith, based in Des Moines, Iowa, is looking for $400 million to $500 million in savings over the next two years as it tries to boost the profitability of the acquired publications in print and online. The sale isn’t a complete surprise: those titles were left out of an earlier proposal by Meredith.
“That was the plan all along I think,” said Craig Huber, an analyst who follows Meredith at Huber Research Partners. “Meredith has never liked the weekly magazine business because the editorial content gets stale very quickly.”
Huber said Newsweek and US News & World Report were each sold for $10 million or less, and he expects Meredith won’t get much more for the titles it just put up for sale “unless some rich family wants to own them for vanity reasons.” Bloomberg LP, the parent of Bloomberg News, owns Businessweek and competes with Fortune in providing business news and information.
The deal for Time gave Meredith a larger audience to compete for advertisers that are consolidating their spending with bigger media companies, as well as Facebook and Google. It also provided the billionaire Koch brothers, who agreed to support Meredith’s offer with an equity injection of $650 million, a stake in well-known media brands.
But Fortune, Sports Illustrated and the other Time Magazine titles were an odd fit for Meredith, whose magazines mostly focus on entertainment, food, lifestyle, home, parenting, beauty and fashion.
Meredith chief executive officer Tom Harty said the magazines being sold have different target audiences and advertising bases, and that “each brand is better suited for success with a new owner.” The company estimates it reaches about 80% of US millennial women.
“We are pleased with the inbound interest we have received,” Harty said in the statement. “We are confident these brands will be positioned for growth with an owner that shares Meredith’s respect for editorial integrity and independence.”
Meredith is keeping People, the most profitable of the former Time titles. At year end, Meredith employed about 3,500 people full time. Reuters