NEW YORK – One day after it announced it was acquiring Time Inc., magazine publisher and broadcast company Meredith Corp. said Koch Equity Development would not have a seat on the Meredith board and “will have no influence on Meredith’s editorial or managerial operations.”
The transaction received $650 million in financial backing from the billionaire Koch brothers, the principals of Koch Equity Development. The entire deal has been valued at $2.8 billion.
After word of the deal began to surface, media analysts questioned whether the Koch brothers would use Time’s publications to promote their conservative views.
In a conference call with analysts this week, Meredith Chairman and Chief Executive Stephen Lacy reiterated that the Koch brothers would not demand any control despite their hefty investment.
“Their desire to be passive and not require a board seat,” along with the financial terms of their investment, “without a doubt made the offer” from the Koch brothers “the most attractive” in terms of financing support available for the merger, Lacy said.
Meredith’s best-known brands include Family Circle and Better Homes and Gardens. In addition to Time magazine, Time Inc. also publishes Entertainment Weekly and People.
Time Inc. and Meredith have struggled like other publishers to make up for shrinking print ad revenue. Time Inc., which was spun off from Time Warner Inc. in 2014, has been hard hit as more readers migrate to digital platforms.
In the first nine months of the year, Time Inc.’s revenue dropped 9 percent to $2 billion, compared with a year earlier.
Lacy told the analysts that Time’s addition would give Meredith the scale and broad lineup of media properties to prosper as the industry migrates from the printed page to digital readership.
Meredith, which also owns 17 television stations, will use the deal to become “a premier media and marketing company with an unparalleled portfolio of national media brands along with a highly profitable local-television business,” Lacy said.
The company said it also would have “leading positions in celebrity, food, lifestyle, news and sports, parenting, and home content creation.”