The spinoff of Time Inc. to create the
world’s largest publicly traded magazine publisher may be just the beginning of
deals for the owner of People and Sports Illustrated.
With analysts estimating an enterprise value
of about $3.9 billion, Time Inc. would be bigger than any other publicly held
company focused on magazine publishing after it separates from Time Warner Inc.
(TWX), according to data compiled by Bloomberg. Following a failed attempt
to divest some magazines to Meredith Corp. (MDP) (MDP), Time Inc. could buy Meredith,
which is half its projected size, to consolidate costs, said Wunderlich
Securities Inc. Or, Time Inc.’s titles and its more than $3 billion in annual revenue may
lure private-equity interest, said Wedbush Inc. Time Inc. “could either be an acquisition target for a larger, traditional publishing company or it could itself be an acquirer,” Brett Harriss, a Rye, New York-based analyst at Gabelli & Co., which owns Time Warner shares, said in a telephone interview. “It’s clear that magazine publishing is likely in secular decline. That being said, it doesn’t mean it’s valueless.”
