United States media company Meredith Corp said on Sunday it will buy Time Inc, the publisher of Sports Illustrated and Fortune magazines, in a $1.84 billion allcash deal backed by conservative billionaire brothers Charles and David Koch. Helping to finance the purchase are billionaire brothers Charles and David Koch who are also known for their involvement in conservative politics and the Republican Party.
Koch Equity Development will not have a seat on the board nor influence editorial operations, the company said.
Meredith has been trying to buy Time Inc. since at least 2013, when its first offer was rejected because the two companies could not agree on what magazine titles would be included in the deal.
"We are creating a premier media company serving almost 200 million American consumers across industry-leading digital, television, print, video, mobile and social platforms positioned for growth", Meredith CEO Stephen Lacy in a statement.
"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".More news: Kevin Durant: Heated exchange with Russell Westbrook is 'just ball'
In May of this year, Time Inc announced plans to sell some magazines or other properties as it tried to push ahead with a digital strategy.
The transaction will create a diversified media and marketing company with calendar 2016 combined revenues of $4.8 billion - including $2.7 billion of total advertising revenues with almost $700 million of digital advertising revenues - and adjusted EBITDA of $800 million. The publishing giant has a portfolio of 17 television stations in 12 markets, which reach an estimated 11% of USA households TVs.
The magazines now published by Meredith are not highly circulated, as their current line-up includes niche publications such as Better Homes and Gardens, Every Day with Rachael Ray, and Traditional Home.
The boards of both companies have approved the transaction, which is due to be finalized in the first semester of 2018, Meredith said in a statement. Time closed Friday at $16.90/share.
Time chairman John Fahey said the sale was in the best interests of the company and its shareholders, noting the price represented a 46% premium to the closing price of shares on 15 November, the day prior to media reports about the deal.