Rothschild's Koch Connection Pays Off in Pursuit of Time Inc

Open this

Open this

The brothers, who have never owned a media company, "would not have any operational control over the company", sources told The Times, but others warned that they would use the outlets to "promote their brand of conservatism".

Time Inc., the steward of some of the country's most circulated and storied magazine brands, will be sold to the lifestyle-magazine publisher Meredith Corp., the companies announced Sunday.

If the deal goes through, it would finally mark success for Meredith in its third run at acquiring Time. Meredith approached Time again earlier this year, but those discussions also stalled when Meredith reportedly failed to secure enough bank financing for the acquisition.

As it turns out, the Koch brothers are contributing more than that.

Meredith, whose magazines include Better Homes and Gardens, Shape and Family Circle, acquired the company for $18.50 per share. Of that sum, the conservative activists Charles and David Koch will contribute $650 million via their private-equity firm Koch Equity Development, putting an iconic magazine company in the hands of some of the country's biggest Republican donors. Wall Street responded enthusiastically to Meredith's move, pushing the stock up as much as 16% Monday, before settling down in midday trading to about 10% over the media stock's previous closing price.

The Koch brothers have spent decades building a network of wealthy political donors who pledge money to conservative causes and their advocacy groups. It is unclear how much influence the Kochs would have on Time, which includes Time magazine, People, Sports Illustrated and Entertainment Weekly among its stable of publications. Meredith expects it will save up to $500m in costs in the first two years of operation and plans to "aggressively pay down" debt by 2020. "We look forward to completing the transaction; welcoming the Time Inc. employees to Meredith; delivering on our pledge to achieve identified synergies; and growing shareholder value".

Latest News