Meredith Corporation announced it has entered into a definitive agreement to sell the Time media brand to Marc and Lynne Benioff for US$190 million in cash. The transaction is subject to customary closing conditions and regulatory approval and is expected to close within 30 days.
The Benioffs are purchasing TIME personally and the transaction is unrelated to Salesforce.com, where Mr. Benioff is chairman, co-CEO and founder. Mr and Mrs Benioff will not be involved in the day-to-day operations or journalistic decisions, which will continue to be led by Time's current executive leadership team.
"We're pleased to have found such passionate buyers in Marc and Lynne Benioff for the Time brand," said Meredith president and CEO Tom Harty. "For over 90 years, Time has been at the forefront of the most significant events and impactful stories that shape our global conversation. We know Time will continue to succeed and is in good hands with the Benioffs. We thank the Time team for its ongoing hard work and passionate commitment."
Meredith acquired Time as part of its purchase of Time Inc., which closed on January 31, 2018. Shortly thereafter, Meredith announced it was selling Time Inc.'s news and sports brands – Time, Sports Illustrated, Fortune and Money – to focus on brands serving its core audience of American women. Meredith expects to announce agreements for the remaining asset sales in the near future.
"We are honoured to be the caretakers of one of the world's most important media companies and iconic brands," said the Benioffs. "Time has always been a trusted reflection of the state of the world, and reminds us that business is one of the greatest platforms for change."
"On behalf of the entire Time team, we are very excited to begin this next chapter in our history," said Time editor-in-chief Edward Felsenthal. "We can't imagine better stewards for TIME than Marc and Lynne Benioff. The team is inspired by their commitment to high-quality journalism and by their confidence in the work we have done to transform and expand the brand in new directions."
As part of the transaction, Meredith will provide short-term business continuity services and has entered into a multi-year agreement with the Benioffs to provide services such as consumer marketing, subscription fulfillment, paper purchasing and printing. Meredith will also be able to include the Time brand in large corporate advertising buys.
Meredith plans to use proceeds from the transaction to pay down debt. Meredith expects to reduce its debt by $1 billion during fiscal 2019. Meredith is targeting a net debt-to-EBITDA ratio of 2.0x to 1 or better by the end of its fiscal 2020. This includes generating $1 billion of EBITDA and having net debt below $2 billion by the end of fiscal 2020.
Citigroup Global Markets Inc. served as financial advisor to Meredith and Cooley LLP served as legal advisor. BDT & Company served as financial advisor to the Benioffs and Goodwin Procter LLP served as legal advisor.
Meredith Corporation is a member of FIPP.
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