If Meredith Corp. buys most of Time Inc.'s magazines, the deal would give Meredith its first significant international operation -- that is, if the international titles are included as part of the deal.
Time Inc. now owns U.K. and Mexican publishers that could go to Meredith in a sale. IPC Media and Grupo Expansion both have some pieces that would slot well into the Meredith portfolio, and others that wouldn't.
Time bought Grupo Expansion in 2005 for an estimated $60 million. The Mexican company's 17 titles include Meredith-like women's monthlies and a celebrity magazine, as well as business and construction titles.
IPC Media's 60 U.K. titles range from The Field for the land-owning gentry to lifestyle publication Wallpaper, and include a lot of women's titles. Time paid $1.7 billion for IPC in 2001, but it's estimated to be worth only about half that now, an incentive for Time to consider selling IPC for the tax write-down.
Then again, Meredith could sell the international titles to help pay for the deal. IPC posted profit of $69 million on revenue of $501 million in 2011, up from a $56 million profit on sales of $511 million the previous year.
"IPC could still perform well as a standalone business," said Alex de Groote, a media analyst at Panmure Gordon. "It looks as though it could sustain itself if there was a buyout, as long as they can find someone to lend them the money." IPC has taken that route before, in a $1.3 billion buyout from publisher Reed Elsevier in 1998, before selling itself to Time in 2001.
Meredith's international presence is through licensed editions of titles like Better Homes and Gardens and an almost 20% stake in Iris Worldwide.