On Wednesday, Meredith Corporation announced its acquisition of Time Inc. was complete. February 1 marks the first day of operations for the combined company.
The final merging of the two companies culminates what was possibly the most surprising media story of 2017. Late last year, when Meredith announced its plans, some were shaken to learn the Koch brothers were, in part, behind the funding. In the months that followed, speculation swirled around the fate of some of Time Inc.’s stalwart titles.
Essence and Sunset were sold; there were rumored talks of investors interested in Golf.
This week, the company shared both its plans for the newly formed company, including plans for advertising and diversifying structures.
Newly appointed Meredith President and COO Tom Harty stated: “Teams from Meredith and Time have been developing an integration plan that has positioned us to hit the ground running." He added it would deliver "on our pledge to achieve the identified synergies and grow shareholder value."
The acquisition of Time Inc. puts Meredith in the powerful position of becoming a top 10 digital media company with around 170 million unique visitors in the U.S., over 10 billion annual video views and almost $700 million in annual digital advertising revenue. The company reaches 85% of U.S. millennial women and is poised to benefit from native, video, programmatic, social and shopper marketing advertising platforms.
“In a business environment that values scale, Meredith's new digital audience and cross-channel audiences position the company to compete effectively against other entities in the top 10,” Susan Bidel, a senior analyst with Forrester, told Publishing Insider. “When that audience is combined with trusted brands, viewable ad inventory and human traffic, Meredith offers advertisers a compelling option to buying on a straight audience basis.”
The company plans to benefit from consumer diversification and growth, as well. With the trove of new titles it has acquired, it plans to bundle circulation activities that will allow it to reach 60 million individual magazine subscribers.
Bidel added: “Meredith's track record of building and sustaining relationships with their biggest advertisers and their thoughtful approach to transforming their business as their audience preferences change give them a fighting chance to be a first-choice partner for the biggest advertisers.”
Meredith expects the acquisition will result in free cash flow in the first full year of operations. The synergizing of company costs in the range of $400 million to $500 million in the first two years of operation.