The long-running, on-off-on saga of the sale of US publishing group Time Inc is nearing its conclusion and the $2.8bn deal to acquire the business by Iowa-based Meredith Corporation is likely to complete by the end of January, barring any last-minute interventions.
However, Meredith – which used to own Sail magazine but sold it in the 1990s – has shown no great enthusiasm for the British-based division of the company, which publishes Motor Boat & Yachting, Yachting World, Yachting Monthly and Practical Boat Owner, along with another 45 magazines and related websites covering a broad spectrum of subject matter.
Time Inc, the parent group, put its UK-based business up for sale in mid-2017, but according to yesterday’s report in the London Sunday Times, negotiations with the buyout company Epiris (ex-Electra Partners), in association with the former strategy director of United Business Media and owner of New Scientist magazine, Sir Bernard Gray, have become protracted if not actually stalled.
The Sunday Times news piece suggests the deal valuing the UK business at £150m is on a “knife edge”. Speculation suggesting that the sale of Time Inc UK is a pre-requisite of the purchase of the parent company by Meredith could not be verified from the offer documents sent to stockholders in mid-December. However, from the chronology of the negotiations between Meredith and Time Inc, described in detail, it is apparent that progress of the UK business sale was clearly an issue of considerable interest to both parties, as was the very significant pension liability which attaches to the Time Inc UK business.
In 2001, Time Warner Inc paid £1.1bn for essentially the same business less some peripheral titles, then known as IPC Magazines, which Time Inc is now trying to divest. Challenging times in the periodical publishing industry in subsequent years has led to a sharp decline in valuations.