The New York Times has shed some light on the inner workings of Meredith’s attempt to purchase most of Time Inc.’s magazines. If the deal goes through the titles, along with Meredith glossies, would go under a separate, new entity. That company would then “borrow money to pay a one-time dividend back to Time Warner, essentially turning what appears to be a corporate spinoff into a sale.” The pricetag? About $1.75 billion.
As has been repeatedly mentioned, Time Warner would keep Time, SI and Fortune. The reasons behind that vary. One source told the Times that Meredith simply doesn’t want those magazines because they’re a money pit. Another said that Jeffrey Bewkes, CEO of Time Warner, wants to keep Time and the others because it’s better to just keep the magazines than to sell them at such a low price.
Bewkes’ reason seems a bit fishy, right? If Time and SI aren’t fetching a nice sum now, it’s only going to go lower. So yeah, we’re inclined to believe Meredith’s reason for the magazines not being included in the deal.