It's Official: Time Inc. Buys AmEx's Food & Wine, Travel & Leisure Magazines
Time Inc. also adds Departures, Black Ink and Executive Travel to its roster of 21 titles, the publisher said Tuesday in a statement.Word of the pending deal first emerged on Monday.
Financial terms weren't disclosed, but a person familiar with the deal said the $100 million figure floated in a New York Post report was high. The deal is expected to close Oct. 1.
The magazine company is preparing to spin off from Time Warner Inc. in the first quarter of 2014. Time Warner CEO Jeffrey Bewkes announced plans in March to separate Time Inc. -- his worst-performing division -- after an unsuccessful effort to create a joint venture with Meredith Corp., publisher of women's titles such as Ladies' Home Journal.
In July, Bewkes named Joseph Ripp CEO of Time Inc. after a four-month search.
"I am very excited about the possibilities for expanding these world-class brands, along with the rest of our portfolio, as we prepare to become an independent company," Mr. Ripp said in a note today to employees about the transaction.
As a public company, projections for New York-based Time Inc.'s enterprise value -- or the sum of its equity and debt minus cash -- range from $2.7 billion to about $4.9 billion, according to six analysts' estimates compiled by Bloomberg in July.
American Express, based in New York, is selling the magazines because banking regulations restrict the company from non-financial activities, it said in the statement.
When the deal closes, the American Express titles will report into Evelyn Webster, exec VP and group president of Time Inc.'s lifestyle group. Ed Kelly, president-CEO at American Express Publishing, will report to Ms. Webster.
Time Inc.'s portfolio has been relatively steady lately but from 2006 through 2009 the company was more likely to sell or close publications than to acquire them. It sold 18 magazines, including Popular Science and Field & Stream, to Bonnier in 2007, and closed titles such as Southern Accents, Teen People, SI Latino and Cottage Living amid a variety of challenges.
~ Bloomberg News and Ad Age staff ~