After weeks of reported negotiations, Time Warner has abruptly ended talks to combine Time Inc. titles with Meredith into a new company and is instead announcing that it will spin off Time Inc. as a separate, publicly traded company. The separation is expected to be finished by the end of the year.
In the meantime, Time Inc. CEO Laura Lang has decided to step down following the transaction.
"After a thorough review of options, we believe that a separation will better position both Time Warner and Time Inc.," says TW chairman and CEO Jeff Bewkes in a statement. "A complete spin-off of Time Inc. provides strategic clarity for Time Warner Inc., enabling us to focus entirely on our television networks and film and TV production businesses, and improves our growth profile. Time Inc. will also benefit from the flexibility and focus of being a stand-alone public company and will now be able to attract a more natural stockholder base. As we saw with the prior spin-offs of Time Warner Cable and AOL, we expect the separation will create additional value for our stockholders.”
According to the announcement, Lang notified Bewkes that she wanted to step down. “Laura indicated to me that we should find a different kind of CEO for this new public company, and I respect her decision,” says Bewkes.
In a separate announcement today, Meredith Corp. confirmed the discussions, indicating the deal was initiated by Time Warner. "At Time Warner’s initiation, we discussed combining our National Media Group with certain Time Inc. brands to create a new publicly traded company. There are natural synergies between our two portfolios; however, we respect Time Warner’s decision and certainly remain open to continuing a dialogue on how our companies might work together on future opportunities."