Saying he was putting together what he called a “hit list” of stations, Meredith CEO Stephen Lacy told Reuters Monday, his company is looking to grow its local TV station group.
Lacy said when Meredith lost out to Sinclair in its deal for Allbritton’s TV stations and to Tribune in its acquisition of Local TV it decided to take a different route. “We were always second,” Lacy told Reuters. “We are going to take a different approach and stay out of the auction hoopla.”
Lacy revealed Meredith’s strategy is more straight forward, “We are putting together a hit-list of (TV) properties and working with owners.”
Meredith’s target list includes TV stations in the top 25 markets in the United States that have the No. 1- or No. 2-rated local news broadcasts.
“All the money is in news,” Lacy said, adding that 40 percent of all advertising dollars are directed toward local news casts.
Meredith publishes magazines such as Better Homes and Gardens and Every Day with Rachael Ray and has a marketing services arm and owns 13 TV stations across the United States in cities such as Atlanta and Las Vegas.
The plan is to increase Meredith’s broadcast revenue to about $500 million. Currently its revenue is $375 million while its publishing division, which includes its marketing services arm has $1.1 billion. The profit between the divisions is split about evenly.
Once Meredith reaches that goal it could potentially separate its broadcasting arm from its magazines. “The reason we are reluctant (now) is the scale,” Lacy said. “We talk about spinning a great deal.”
Several media conglomerates such as News Corp, Tribune and Time Warner Inc are separating their publishing assets from faster growing entertainment and TV properties.
Meredith was in talks earlier this year with Time Warner to hammer out a potential tie-up Time Warner’s publishing division Time Inc, the publisher of People, Sports Illustrated and Time. The talks fell apart and Time Warner plans to spin out Time Inc as a standalone company.