So much for moving to Iowa. Following reports from earlier today that Time Warner’s plan to sell its Time Inc. publishing unit to Des Moines-based Meredith Corp. had collapsed, the firm announced plans to spin off Time Inc. as an independent, publicly traded company by the end of 2013.
Time Warner chairman and CEO Jeff Bewkes also said Laura Lang, the current CEO of Time Inc., is planning to step down as soon as the the spinoff is completed. “Laura indicated to me that we should find a different kind of CEO for this new public company, and I respect her decision,” Bewkes said in a statement. Lang, who spent 15 months on the job, has recently kept a low profile, cancelling her appearances at the 4A's and other conferences. Lang was always an unconventional choice for the CEO role, having run Digitas until late 2011.
Reports that the talks between Meredith and Time Inc. had stalled first surfaced this morning. According to The New York Times, “the deal came apart after Time Warner in particular grew increasingly concerned over the future of four of Time Inc.’s iconic but struggling magazines: Time, Sports Illustrated, Fortune and Money.”
According to the original deal with Meredith, Time Inc. would have retained ownership of its flagship title, Time, as well as Sports Illustrated, Fortune and Money, and Meredith would have purchased Time Inc.’s mostly lifestyle titles, including the highly profitable People, for between an estimated $1.7 and $2 billion.
Response within the company to the possible deal wasn’t positive. “There’s a lot of anger at Bewkes over the way he mishandled Time Inc.,” the New York Post’s Keith Kelly reported one insider as saying. There were also talks of an inevitable culture clash from merging glossy titles like InStyle with Meredith’s service-oriented magazines, which includes Better Homes and Gardens and Parenting.