Meredith moves to sell Time, Fortune and Sports Illustrated titles — sources

Meredith Corp Chief Executive Stephen Lacy speaks during an interview with Reuters in New York on March 22, 2013. (REUTERS/Mike Segar)
Updated 16 March 2018
0

Meredith moves to sell Time, Fortune and Sports Illustrated titles — sources

NEW YORK: US media company Meredith Corp. has hired advisers to explore a sale of its Time, Fortune, Money and Sports Illustrated magazines following its $1.84 billion acquisition of Time Inc. in January, people familiar with the matter said.
The move illustrates how Meredith sees some of Time Inc’s titles that attract primarily male readership as not playing to its core strength in women’s magazines, which include Better Homes & Gardens, Family Circle and Martha Stewart Living.
The Des Moines, Iowa-based company has tapped investment banks Citigroup Inc. and Houlihan Lokey Inc. to find potential buyers for the magazines, the sources said this week. There is no certainty that a divestiture will occur, the sources added.
While it’s possible that media, telecommunications or technology companies could express an interest in the magazines, a sale to wealthy individuals, such as philanthropists or billionaires, is viewed by Meredith as more likely, according to one of the sources.
The sources asked not to be identified because details of the sale process are confidential. Citigroup declined to comment, while Houlihan Lokey did not immediately return a request for comment.
“We are in fact exploring a number of additional changes to the (magazine) portfolio, including divestitures of brands and businesses that might perform better under a different owner,” Meredith CEO Steven Lacy told investors at a Deutsche Bank conference earlier this month.
Time Inc. referred calls to Meredith, which declined to comment beyond reiterating that the company is reviewing its portfolio.
It was not clear how much the magazines could be worth. Fortune and Money generated more than $20 million in 12-month earnings before interest, taxes, depreciation and amortization (EBIDTA), while Time generated more than $30 million in 12-month EBITDA, according to one of the people.
The potential divestitures underscore how Time Inc’s primary attraction for Meredith was building scale in digital advertising. With its roots in traditional publishing, Meredith has been in a fierce competitive online race against Internet giants such as Alphabet Inc’s Google and Facebook Inc. for consumer eyeballs and advertising dollars.
The deal with Time Inc. expanded 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.
Meredith’s acquisition of Time Inc. was aided by a $650 million investment from the private equity arm of Charles and David Koch, the billionaire brothers known for championing conservative political causes.


Comcast outbids Fox with $40 billion offer for Sky in auction

Rupert Murdoch, chairman of News Corp and co-chairman of 21st Century Fox, arrives at the Sun Valley Resort of the annual Allen & Company Sun Valley Conference, July 10, 2018 in Sun Valley, Idaho. (AFP)
Updated 23 September 2018
0

Comcast outbids Fox with $40 billion offer for Sky in auction

  • Disney agreed a separate $71 billion deal to buy most of Fox’s film and TV assets, including its existing 39 percent stake in Sky, in June and would have taken full ownership after a successful Fox takeover

LONDON: Comcast beat Rupert Murdoch’s Twenty-First Century Fox in the battle for Sky on Saturday after offering 30.6 billion pounds ($40 billion) in a dramatic auction to decide the fate of the pay-television group.
The US cable giant bid 17.28 pounds a share for control of London-listed Sky, bettering a 15.67 pounds-a-share offer by Fox, Britain’s Takeover Panel said.
Buying Sky will make Philadephia-based Comcast, which owns the NBC network and Universal Pictures, the world’s largest pay-TV operator with around 52 million customers.
Chairman and chief executive Brian Roberts has had his eye on Sky as a way to help counter declines in subscribers for traditional cable TV in its core US market as viewers switch to video-on-demand services like Netflix and Amazon .
“This is a great day for Comcast,” he said. “This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally.”
Comcast’s knock-out offer thwarted Murdoch’s long-held ambition to win control of Sky, and is also a setback for US entertainment giant Walt Disney which would have likely been its ultimate owner.
Disney agreed a separate $71 billion deal to buy most of Fox’s film and TV assets, including its existing 39 percent stake in Sky, in June and would have taken full ownership after a successful Fox takeover.
Comcast’s final offer was significantly higher than its bid going into the auction of 14.75 pounds, and compares with Sky’s closing price of 15.85 pounds on Friday.
Comcast believed it needed to deliver a knock-out blow given that Fox’s existing stake in Sky gave it a chance of victory if it was a close second to Comcast, two sources said.
Comcast’s final offer — more than double Sky’s share price before Fox made its approach in December 2016 — quickly won the backing of Sky’s independent directors on Saturday.
“We are recommending it as it represents materially superior value,” said Martin Gilbert, chairman of Sky’s independent committee. “We are focused on drawing this process to a successful and swift close and therefore urge shareholders to accept the recommended Comcast offer.”
Fox will now concede defeat, a source told Reuters.
It is reviewing options for its stake, a holding that stems from Murdoch’s role in the creation of the company nearly three decades ago, the source said.
Fox declined to comment.
Comcast, which requires 50 percent plus one share of Sky’s equity to win control, said it was also seeking to buy Sky shares in the market.

HUGE PRICE
One hedge fund manager who holds Sky shares said nobody could complain about the Comcast price.
“The question now is if Fox actually sells out and if not can Comcast get to 50 percent,” he said.
Another hedge-fund manager said it was a “huge” price, and shareholders would accept it.
Sources familiar with the matter said Fox, Disney and Comcast had not been in discussions about the 39 percent stake.
The quick-fire auction marked a dramatic climax to a protracted transatlantic bidding battle waged since February, when Comcast gate-crashed Fox’s takeover of Sky.
It is a blow to 87-year-old Murdoch and the US media and entertainment group that he controls, which had been trying to take full ownership of Sky since December 2016.
Murdoch’s son James, currently chairman of Sky, was instrumental in building the company into the leading European pay TV group, with operations in Britain, Ireland, Germany, Austria and Italy, and more than 23 million customers attracted to its top-flight sport and entertainment content.
Sky’s chief executive Jeremy Darroch said it was the beginning of a new chapter. “Sky has never stood still, and with Comcast our momentum will only increase,” he said. ($1 = 0.7648 pounds)